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Financial Confidence

Financial Confidence – Becoming financially empowered is about increasing your financial confidence. Confidence is an overarching condition, but it is also divided into subgroups. Sometimes we may have high confidence in one area, but not in another. Self-confidence means feeling competent in your abilities to do something. So, if we’re talking about financial confidence, the question is: do you feel capable of handling your own finances successfully?

I often refer to this as your Money Skillset. Do you have those skills needed to handle your money in a way that contributes positively to your life? And are you in the driver’s seat of your money house?  

Breaking it down further, let’s look at the different sides of your money:

  • Money coming in (i.e., income)
  • Money going out (i.e., expenses)

Do you have confidence in your ability to earn money? Are you earning what you’re worth? In order to become financially empowered and have high financial confidence, be sure you evaluate this side of the equation. So if you are underearning, it’s time to address the issue. One of the best resources I’ve found for this is the book Overcoming Underearning by Barbara Stanny (now Huron). I won’t explain the entire book here, but if you believe you could be earning more, it’s a great resource. It can really help you suss out the issues and make the changes needed.

Looking at the other side, expenses, you need to look at your spending patterns. Overspending is a rampant epidemic in this country. Most people have this urge to “keep up with the Joneses,” as they say. 

It is essential that you learn to live below your means if you want to get ahead or comfortably retire.

If you spend everything you earn you will always be living hand to mouth. But this doesn’t mean you won’t survive or have a nice lifestyle. It just means you will never have enough to stop working. And it’s likely you won’t have enough for large purchases either, and you will be constantly borrowing money.

Most Americans are living with debt.  And some debt may be necessary.  It’s hard to buy a house without borrowing money. Most people need to borrow money to buy a car, too.  Also, if you’re working on a college education or an advanced degree, it’s hard to do without taking out loans.

Financial Confidence
Financial Confidence

Beyond that, most debt can and should be avoided.  

For example, suppose you are running up your credit cards and struggling to pay them off. This means you are living beyond your means, and it is time to reign things in.  Financial confidence requires that you consciously decide how you spend your money.  Living beyond your means is living like an ostrich with your head in the sand.  Someday, it will bite you in the ass.

Financial confidence or money savvy depends on you earning what you’re worth and living below your means. 

If you are constantly running out of money or in debt, you aren’t going to feel confident about money.

Learn how to manage your money so that you can drive your life where you want it to go. This is paramount to your financial confidence, and it is an important part of being financially savvy.

Sherry Lutz Herrington is the owner of Sherrington Financial Fitness, a business consulting and accounting firm specializing in strategic business planning and solid financial accounting for businesses. She is also the author of Strong Women Thriving (, a blog which focuses on empowering women to be financially savvy, particularly after experiencing financial abuse. Sherry is currently writing a new book that both shares her personal story and addresses financial abuse. She can be reached at Join our FB group

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