How Low Self-Confidence Will Cost You Thousands
Every year we have the opportunity to start with a fresh slate. The New Year yawns before us, brimming with opportunity and new beginnings. Whether or not we consciously make resolutions for the coming year, most of us have a sense of what we want to achieve for the year.
According to a 2012 Harris poll, 46% of Americans make New Year's resolutions. And next to weight loss, improving one's finances was a top goal. Health and money accounted for two-thirds of all yearly goals. However, the vast majority of people don't accomplish what they set out to do on January 1, as only 8% of goal-setters achieve their annual resolutions. For those who set goals to make more money, this lack of follow-through can have a profound impact on their quality of life.
One of the main obstacles to financial success is low self-confidence. Low confidence makes us doubt our abilities and judgment and prevents us from taking calculated risks, setting ambitious goals, and acting on them. At work, people who suffer with this problem often engage in subconscious behaviors that undermine their success, making them less likely to ask for or get promotions, raises and even jobs.
And unfortunately, bosses, clients, and customers make negative assumptions about people who exhibit behaviors of low self-confidence, believing they are incompetent or apathetic.
In several University of Florida studies, Dr. Timothy Judge found people with high levels of self-confidence had better job performance, more job satisfaction, and higher incomes. In fact, believing in yourself and your ability to succeed may be more important than other seemingly more salient indicators of financial success such as family wealth, education and demographics.
Being born into a well-educated, affluent family, does afford a financial advantage. But when you add the element of self-confidence in the mix, the ability to achieve financial success increases dramatically.
“There are certainly significant advantages for children growing up with parents who are well-educated and work in professional occupations, but these advantages are especially profound when children are self-confident,” says Dr. Judge. However, lacking the silver spoon factor doesn’t destine you to low self-confidence or prevent you from being financially successful.
Confidence is such a decisive factor that people from blue-collar families and have self-confidence earn approximately $7,000 more than those from the same class who lack this attribute. Likewise, people from the professional classes who have confidence earn approximately $28,000 more than people without confidence. It appears self-confidence is a lucrative quality, one worth roughly between $7 and $28,000 per year.
“In light of popular beliefs that kids from middle- and upper-class families have it made, it is surprising to see what little positive impact socioeconomic status has in the absence of self-esteem,” says Dr. Judge.
One reason self-confidence is so important is the impact on ambition and motivation. People with a positive attitude who believe in themselves have more ambitious goals, and they act on those goals, leading to more opportunities and higher incomes. Even when they encounter difficulties and adversity, they’re not as likely allow them to impact their self-esteem and success.
The bottom line is this: improving self-confidence pays. Whether you are a lawyer or a brick-layer, if you are self-confident, you are much more likely to make a better income than those with low confidence.
Fortunately self-confidence can be learned through practice. For every incremental amount you improve your self-confidence, you empower yourself to advance your financial success. Just one confident action could win you the account, give you a salary jump, or snare that small business loan. An accumulation of these actions will make a profound impact on your financial future in the coming year.
And of course self-confidence further affords the motivation to manage your money effectively, to make wise financial decisions, to go after additional training or education, and to set realistic yet challenging financial goals. In fact, for those those lacking self-confidence, improving it should be a top New Year's resolution — one that will lead to success in all of your resolutions.
Here are some proven strategies for boosting confidence and ultimately improving your financial situation.
The effects of exercise on your self-esteem are profound. During exercise, your body releases endorphins that give you a boost of energy and positive feelings. Simply the accomplishment of completing an exercise routine affords a boost of confidence you can carry with you throughout the day.
Whether or not we like it, others judge us and our abilities by our appearance. We can't change some things about our appearance, but when we look our best, confidence will follow. Take the steps to assess and improve your wardrobe. Maintain a healthy weight and pay attention to your grooming. Practice healthy self-acceptance of the things you can't change, and focus on your best features.
3. Body Language
According to social psychologist Amy Cuddy of Harvard Business School, people with powerful body language such as movements that are open and spread out and take up a lot of space— feel more confident and are perceived as more powerful. Even if you fake these movements, it will trick your brain into having confident feelings . You’ll be more likely to take risks, feel optimistic, and even produce less cortisol (a stress hormone) and more testosterone (the dominance hormone). Conversely, timid body language tends to limit feelings of confidence. Forced smiling has the same impact, making you feel happier and more successful.
Whenever you see the opportunity to increase your financial success, take action. You won’t get the raise unless you ask for it. You won’t snag the better position unless you negotiate. You won’t close the deal unless you push for it. The more you practice confident actions, the more confident you'll feel. The worst that could happen is getting a “no.” A “no” doesn’t mean you aren’t worth it, you aren’t good enough, or they don’t like you. A “no” is an invitation to try again more creatively, or it’s reflection of a legitimate reason for “not this time.”
As you define your goals and resolutions for the year, put improving your confidence at the top of the list. Practice confident behaviors and actions every day, even when confident feelings aren't present. Reinforce your new behaviors with healthy choices and mindful self-acceptance. As your confidence improves, you'll be surprised at the impact it has on your bottom line. By the end of the year, you could be thousands of dollars ahead.