Why having plenty of money can still feel like living in fear of going broke

You probably know someone who earns a solid six-figure salary but still argues with a street vendor over a 5-baht discount, always orders the cheapest thing on the menu, and won’t buy health insurance because it “feels like a waste,” even though their savings account is comfortably full. And you probably also know someone whose income isn’t high at all, yet lives without that fear, invests in themselves, helps others when it matters, and still watches their savings grow.

Behavioral economists call that gap scarcity mindset versus abundance mindset, and it has almost nothing to do with the actual number in the bank account.

A brain that once went without stays afraid long after

Research by Sendhil Mullainathan and Eldar Shafir, authors of the book Scarcity, found that living under prolonged scarcity, whether of money, time, or any other resource, pulls your mental bandwidth toward the shortage itself without you noticing. You get sharper at short-term decisions and worse at long-term planning.

The interesting part is that once a brain has gone through real scarcity, the pattern often doesn’t disappear even after circumstances improve. Someone who struggled as a kid and is financially comfortable now can still carry that fear deep down, even though the numbers say they don’t need to anymore. That’s exactly why the six-figure earner from the opening example is still arguing over a 5-baht discount.

The fear is rooted in childhood, not the present

Financial psychologist Brad Klontz proposes a framework called Money Scripts, the idea that each person’s core beliefs about money were usually formed in childhood. Roughly four patterns show up. Some people believe money is dangerous and should be avoided. Some believe money equals happiness. Some believe money measures their worth in society. And some believe every baht needs constant watching to feel safe.

None of these beliefs are wrong exactly. They were coping mechanisms that once helped someone survive a specific situation. The problem is that when circumstances change, the old belief keeps running the same way, and it turns into something that blocks life instead of protecting it.

Expanding mental bandwidth takes a system, not just willpower

The research doesn’t suggest telling yourself “don’t be afraid,” because that doesn’t work on fear this deeply wired. What works better is reducing the number of money decisions that require willpower each day, setting up automatic savings transfers instead of deciding to save fresh every month, and building a clear buffer into your budget. Studies found that people with even a small financial buffer show significantly less scarcity-driven thinking, even when their income stays exactly the same.

Put differently, the feeling of psychological wealth comes from having breathing room built into your financial system, not from the number in the account alone.

I kept my own emergency fund padded well beyond what I actually needed for years without realizing it, only to later figure out that extra cushion could have gone into investing or building a skill a long time ago. The fear that kept that money sitting idle never had as much logic behind it as it felt like it did.

Try this now

Think of one money behavior you still do even though your situation has genuinely improved, maybe avoiding a necessary purchase out of guilt, or hoarding money you won’t even spend on something worth investing in. Notice whether that feeling comes from your actual situation now, or from an old fear left over from the past.

This week, pick one thing an abundance mindset would do, nothing dramatic, maybe buying a better version of something you genuinely need, and pay attention to the fear that shows up. That’s the trace of scarcity mindset you’re slowly loosening.