Challenging Thoughts Related to Financial Anxiety
Part 1 of this series, introducing CBT for financial anxiety, explored how to begin recognizing the thoughts, behaviors, and emotions that result from a financial situation. This article will examine how to become more accurate and flexible in your thinking by challenging automatic thoughts.
Why Challenge Automatic Thoughts?
Challenging automatic thoughts is like mining for truth, digging through layers of biases to uncover the nuggets of reality. It is important that these thoughts are not taken at face value because thoughts that occur in response to stressful situations tend to be negatively skewed for a few reasons:
Many situations require us to react quickly and these thoughts are often driven by emotion. Emotionally-driven thoughts are not the most nuanced of perceptions, leading to errors in information processing.
Everyone is subject to the negativity bias. In short, this bias holds that the bad is stronger than the good across many life domains. For instance, you could spend years building up your professional reputation at a company, but one sufficiently negative action could spoil your reputation. Or if you take four helpful financial actions and make one mistake, you are far more likely to zero in on the error.
Both the emotionally driven nature of our thoughts and the negativity bias likely exist for survival purposes. There is a distinct advantage to believing an unexplained noise in the night is a burglar rather than a random creak, and to act quickly on this interpretation. Similarly, people are far more likely to have negative and exaggerated thoughts about their finances because money is important to so many aspects of our lives, dreams, and values.
How to Challenge Automatic Thoughts?
So what can be done now that you have identified some of your automatic thoughts about finances?
You can check the facts and take different perspectives with the aim of seeing a situation as realistically as possible. As opposed to toxic positivity–or putting an optimistic sheen on everything–challenging our automatic thoughts will help to see reality and respond as effectively as possible.
A well-established method within CBT is to use Socratic questions from the perspective of a neutral observer. Imagine a fair-minded judge or a scientist seeking out truth. The questions I have found most effective with clients are listed below and explained in italics.
What is the evidence your thought is true? What is the evidence your thought may not be true?
List objective evidence both for and against your thought. Additional thoughts or interpretations are not evidence. Emotions are not evidence.
What is the worst-case scenario related to your thought? How likely is it to occur (0-100%)? If it happens, how will you cope?
Let your mind go to the worst possible outcome and write it down. Now estimate the likelihood of this scenario coming true using reliable, objective data. Finally, list out practical actions you could take to cope with this outcome if it occurred. Who could you reach out to for help? What skills or strategies could you use to get through the situation?
What is the best case scenario? How likely is it to occur (0-100%)
Imagine the most positive outcome and estimate the likelihood it will happen.
What is the most realistic scenario?
Now try to think of the likeliest outcome in this situation. This is typically something between the worst and best case scenarios above.
What effect does believing your thought have on you? What effect could changing your belief have on you?
What does the automatic thought you selected above make you feel and do? Is this helpful for your financial goals and in line with your values? Now consider how your emotions and behaviors may change if you alter your perspective on the situation.
What would you tell a friend who was in the same situation and had the same thought as you?
We are typically more objective and helpful when we consider a friend’s money problems. What thoughts or advice would you have for a friend in this situation?
How important will this situation seem when you are 80 years old?
In the moment, a stressful financial situation can seem life-altering. Try taking the long view and determine the more objective impact of the situation.
What is a more realistic way of looking at this situation?
Read over your responses to the prior questions and generate an alternative thought that is believable and supported by facts. This should not be a positive thought with no evidence to support it.
What emotions are you experiencing now?
A marker that you have successfully challenged your thought is a shift in emotion. Often the initial emotions lessen in intensity and you may notice positive emotions.
It is possible that you find your initial thought is well supported by the evidence. If you do find that the thought is true, try a combination of problem solving and acceptance. I will revisit this topic in a later article. In the meantime, I created the Challenging Financial Thoughts Worksheet to practice examining your own thoughts as well as an Example of a Completed Challenging Financial Thoughts Worksheet to help illustrate the use of the worksheet. Make Socrates proud!