If you’re constantly worrying about money, you’re probably falling into these 8 traps, according to psychology

If you’ve spent countless nights tossing and turning, wondering how to pay your bills or meet next month’s mortgage, trust me—you’re not alone.

Worrying about money is almost a universal phenomenon. But if money stress has become your constant companion, there’s a good chance you’re falling into certain psychological traps that keep you stuck in this cycle of anxiety.

I’ve seen this happen to countless friends, colleagues, and even fellow entrepreneurs. And truth be told, I’ve been there myself. There’s nothing quite like the sinking feeling of not knowing where your financial future is headed. But over the years, I’ve noticed eight common traps that tend to trip us up. Let’s dive in.

1. You rely on comparisons to gauge your worth

Ever catch yourself scrolling through social media and thinking, “Wow, that person’s so much better off than I am”? This is one of the sneakiest traps out there. We see someone posing with a new sports car, traveling the world, or posting about their six-figure launch, and we immediately assume we’re doing something wrong.

According to a survey published in the Journal of Social and Clinical Psychology, social comparison is a major predictor of depressive symptoms and anxiety. When it comes to money, we’re not just envying someone’s Instagram feed; we’re tying our bank balances to our self-esteem.

Here’s the thing, though: you rarely see the behind-the-scenes reality. People don’t tend to broadcast their debts, failed investments, or financial struggles. So if you’re forever comparing yourself to the glossy highlight reel of others, you’re stacking the deck against your own peace of mind.

Instead, try setting your own benchmarks. Focus on the milestones that matter to you. Sure, it’s easier said than done, but it’s a huge step toward reducing money-related anxiety. If you must compare, compare who you are today to who you were yesterday, not to some random influencer on TikTok.

2. You’re stuck in a scarcity mindset

Have you ever felt like there’s never enough money, time, or opportunity to go around? That’s scarcity mindset in a nutshell. It’s the nagging belief that you always have to cling to what you have, because the next paycheck or business lead might never come.

Psychologist Eldar Shafir, co-author of the book Scarcity: Why Having Too Little Means So Much, notes that scarcity often warps our thinking, compelling us to make poor decisions.

When we believe resources are forever limited, we get reactive. We might overspend when we finally come into some cash, or ironically become so paralyzed by the fear of losing what we have that we fail to invest in areas that could actually grow our wealth.

Breaking out of scarcity starts with recognizing that it’s primarily a mental framework. Yes, real financial constraints exist. But when we operate with the conviction that more is possible—whether it’s earning more or spending less—it’s surprising how many solutions suddenly pop into view.

3. You tie your self-worth directly to your net worth

I used to do this without even realizing it. The moment my bank account dipped, my mood took a nosedive. If a business venture didn’t bring in the profits I hoped for, I’d start questioning my abilities, intelligence, and identity as an entrepreneur.

The thing is, your net worth should be separate from your self-worth. As Brené Brown has said, “You are imperfect, you are wired for struggle, but you are worthy of love and belonging.” That worthiness doesn’t vanish with a bad financial month.

When we allow money to define who we are, every financial setback feels deeply personal. Suddenly, a dip in cash flow becomes a blow to our entire sense of self. The way out? Remind yourself that money is a tool—an important one, but not a measure of your inherent value as a human being.

4. You avoid talking about money

Let’s be honest: conversations about money can be awkward. We’re often taught that discussing finances is impolite or invasive. But by avoiding it altogether, we trap ourselves in a bubble of ignorance.

I once spoke to a friend who was in dire financial straits. When I asked why he never mentioned it before, he just shrugged and said, “I didn’t want people to think less of me.” That’s the problem in a nutshell. We’d rather suffer in silence than risk judgment.

However, research highlighted by the American Psychological Association indicates that openness around money can reduce stress and encourage healthier financial habits.

When you air out your concerns—whether it’s with a financial advisor, a close friend, or your partner—you’ll often discover fresh perspectives and solutions you didn’t know existed.

So don’t let the discomfort keep you from having these discussions. Yes, you might have to swallow your pride, but you’ll thank yourself later when you find you’re not as alone as you once thought.

5. You don’t have a clear financial roadmap

If you’re like me, there was a time when you simply “winged it” every month—paying off bills as they came, hoping your income would cover everything, and praying that life’s surprises didn’t throw you off track. It felt chaotic and downright stressful.

Without a plan, every financial hiccup becomes a crisis. And crises trigger worry. It’s no wonder so many of us lie awake at night, biting our nails over money.

As Tim Ferriss once said, “What we fear doing most is usually what we most need to do.” If creating a budget, planning for taxes, or setting aside an emergency fund terrifies you, that’s probably a sign it needs to be tackled head-on.

Here at Small Biz Technology, we see many entrepreneurs who resist formalizing a financial plan because it feels restricting. But the opposite is often true: having a roadmap actually gives you freedom. You know your boundaries, where you can spend a bit more, and how to handle an unexpected dip in cash flow.

6. You’re convinced it’s “just you” who struggles

It’s easy to look around and assume everyone else is financially stable. You see neighbors with new cars, colleagues wearing designer suits, or peers who seem to always have the latest gadget.

But that assumption can be wildly off base. A close friend once confided that he had tens of thousands of dollars in credit card debt, even though he always wore expensive clothes and regularly traveled first-class. It was all a front—an image that masked a financial mess.

Charlie Munger put it well: “The big money is not in the buying or selling… but in the waiting.” That statement underscores the idea that wealth often takes time to grow, and what looks like wealth on the surface might actually be heavily financed by debt or risk.

Remember that almost everyone experiences money concerns at some point in life. You’re not defective because you worry; you’re simply human. The difference is whether you let that worry control your life or you take steps to address it.

7. You think more income is the only solution

How many times have you said, “If I just made $10,000 more a year, I’d be set”? It’s an easy trap to fall into—believing that a higher income or a bigger profit margin is the magic bullet for financial stress.

The catch? Lifestyle inflation tends to follow pay raises like night follows day. You earn more, then you spend more. Suddenly, that extra $10,000 isn’t making a dent in your worries because you’ve ramped up your expenses.

This phenomenon is sometimes called “the hedonic treadmill,” where satisfaction from higher earnings wears off quickly, leaving you wanting more and more.

Real financial peace often comes from balancing three areas: earning, spending, and saving. If you can dial in all three—rather than just focusing on growing your income—you stand a far better chance of breaking the cycle of worry.

As Warren Buffett famously noted, “Do not save what is left after spending; instead spend what is left after saving.” The principle is to allocate your money intentionally, rather than letting it slip through your fingers.

8. You try to handle it all on your own

Sometimes we think seeking guidance is a sign of weakness. We hesitate to hire a financial advisor, attend a money management workshop, or even use an online budgeting app. We assume we “should” be able to handle it ourselves.

But the truth is, if you’re overwhelmed, there’s absolutely no shame in asking for help. Financial anxiety can be paralyzing, and even the best of us can’t be experts in everything. Plenty of entrepreneurs and professionals have coaches or advisors to help keep them on track. Why shouldn’t you?

I’ve mentioned this before, but when I started getting professional input, my perspective changed dramatically. I felt less isolated and more equipped to make informed decisions about investments, savings, and growth strategies.

You don’t have to reinvent the wheel. Leverage the experience and knowledge of those who’ve walked this path.

Final words

Money worries can feel like an inescapable swamp, especially when it seems like every dime you earn goes toward bills, debt, or investments with no tangible return. But recognizing these eight traps is the first step toward climbing out of that bog of anxiety.

By focusing on what you can control—your mindset, your spending, your openness to seeking advice—you might be surprised at how quickly the weight on your shoulders begins to lift. Yes, life can be expensive and unpredictable. But you have more agency over your financial destiny than you think.

My hope is that something in these eight points resonates with you. If it does, take action. Even a small shift in perspective or a tiny change in habit can have a ripple effect on your finances—and your well-being.

We can’t eliminate every stressor in life, but we can certainly learn to navigate them in ways that lead to greater peace of mind. And to me, that’s worth more than any number in the bank.