MONEY COMMENT
Nine Million Suffer Financial Phobia

By Jane Mack (TMFJane)
January 28, 2003

It looks like Financial Phobia is a genuine psychological syndrome according to a report published by a Cambridge academic and the finance group, Egg.

The study reveals that about a fifth of Britons who struggle to manage their finances are not lazy, irresponsible or feckless but are likely to be the victims of a newly-discovered psychological and physical condition which renders them incapable of managing their money effectively.

Over half of sufferers (54 per cent) experience apprehension, while four in ten (38 per cent) show complete disinterest in money matters. Nearly half (45 per cent) report a racing heart, over one in ten (12 per cent) are physically ill or feel dizzy (11 per cent) and one in six (15 per cent) find themselves simply unable to handle their finances at all.

They respond by not opening bank statements; never checking bank balances; and, in the most extreme cases, throwing away or filing unopened statements to avoid dealing with their personal finances altogether.

In all about nine million people could be described as Financialphobes although it's thought that around half of the population show some signs of it.

The interesting thing about Financial Phobia is that its onset appears to co-incide with some form of financial upset - such as the mis-selling of financial products – which is out of the control of the sufferer. Others causes include a lack of confidence in the ability to understand the small print, which in turn can lead to financial avoidance.

As we've always said at The Motley Fool, money isn't really that difficult to understand once you put your mind to it. When you understand the basics, it isn't hard to keep your finances under control. As with any sort of phobia, the trick is to face it head on, however unpleasant it may be at first.

If you're in debt, for example, it's hardly surprising that you might not want to open bank statements. But the better solution is to work on getting out of debt by learning about it so that the fear disappears along with the debt.

So if you suffer from Financial Phobia, then start your therapy immediately by heading off to our Fool School section to learn how to cope with money. You won't regret it.