This is the first in our 4-part series looking at money anxiety. Today we start by examining what anxiety is and how this human emotion has affected us over millions of years.
Our anxiety levels have never been higher, from worrying about the health of our vulnerable relatives to worrying about our jobs and finances, and for many of us there is no immediate respite in sight. When we’re anxious, we feel that we have no control and panic sets in. As a result, we struggle to focus and this leads to a lack of clarity, which in turn triggers further panic. Furthermore, fear traps and inhibits us from moving forward and doing the things that could improve our situation.
Where does anxiety come from and what is its purpose?
To answer this we need to look at how the brain works. The human brain is sensitive to looking out for and reacting to dangerous situations. It has evolved to keep us alive in circumstances when the threats to our existence were mostly physical. Evolution designed the brain to answer the question ‘What should I do?’ before ‘What is it?’ as spotting danger was so important. In fact, our ancestors will have run with great haste from danger before knowing exactly what the danger was, reacting without having to think. Scientists refer to this part of the brain as our lower brain. It’s hyper-sensitive and hyper-responsive and over 150 million years old.
When we were living on the savannahs of Africa, there were lots of things that might kill us. Decisions needed to be made very quickly, so this strategy worked well. Nowadays we understand that when the brain detects danger it releases cortisol and adrenaline and, along with a host of other physiological effects, it prepares the body to run or fight. This burst of neurochemical energy is getting us ready for action and it’s a very real feeling. And the brain is always looking out for threats – the system operates 24×7.
The evolution of the brain
Fortunately for us, our brain has evolved and given us a new higher brain that sits above the lower brain and is only a few million years old. It does some fantastic things that we think make us uniquely human. For example, it enables us to consider someone else’s perspective, even if we don’t agree with them. It also means we can reflect about abstract concepts, like the future. But significantly this higher brain acts as a brake on the lower brain. The higher brain is the one that says ‘I wonder what that is’ and ‘that’s interesting, let me think about that’. This normally this works fine until the lower brain gets triggered and interrupts the functioning of the higher brain.
Our lower brain has, unfortunately, not evolved to help us make sense of today’s world and it is unable to differentiate between physical threats and emotional threats. It still reacts to any perceived threat by releasing cortisol and adrenaline, even if that threat is something imagined in the future or something on the TV. Right now it is being triggered by threats to our financial situation. We recognise this as money anxiety and, in effect, it’s our lower brain shouting ‘WATCH OUT. DO SOMETHING’. If we don’t deal with it, this anxiety can lead to panic.
Looking ahead…
On Thursday we will look at ways of dealing with money anxiety so that we are able to make good financial decisions.
Dennis Harhalakis is the Founder of Cambridge Money Coaching
