Fuel prices just spiked hard. Here's what that does to your brain.
A record diesel price is hitting self-employed people right now. Loss aversion explains why it feels so much worse than it is.
The pump just got a lot more painful
BBC News reports that diesel prices in the UK have hit an all-time high of 199.18p per litre, according to the RAC. The RAC says prices have entered “uncharted territory,” driven by the ongoing war in the Middle East.
That’s a big number. And if you drive to clients, retreats, workshops, or anywhere your work takes you, you felt it the moment you stood at the pump.
But here’s the thing I want to talk about. It’s not just your wallet that’s hurting. It’s your nervous system.
Why this feels bigger than it is
There’s a well-established idea in behavioural economics called loss aversion. Kahneman and Tversky identified it: losses feel roughly twice as painful as equivalent gains feel good. So a cost going up hits harder, emotionally, than a revenue win of the same size would feel rewarding.
When diesel rises by 59p a litre, as BBC News reports it has since the conflict began at the end of February, you don’t just register a cost increase. Your brain registers a loss. Something was taken. Something you had is now gone.
That’s not weakness. That’s just how human brains are built.
Then the feast-or-famine loop kicks in
For self-employed people, coaches, and wellness practitioners, loss aversion rarely stays quiet. It tends to echo.
You fill the tank. You see the number. Your brain logs a loss. Then it starts scanning for other losses. What else is going up? What if bookings drop? What if clients can’t afford me anymore? What if I can’t afford to keep driving to them?
That spiral has a name too. It connects to what Brad and Ted Klontz call money scripts, the deep, often unconscious stories we carry about money and safety. For a lot of self-employed people, one of those scripts sounds like: my income is always one shock away from collapse.
A fuel spike doesn’t create that belief. It just wakes it up.
There’s also something called the ostrich effect
Galai and Sade identified the ostrich effect: when financial information feels threatening, people avoid looking at it altogether. You know the tank needs filling, but you don’t want to check the price. You know your running costs have gone up, but you don’t open the spreadsheet.
This makes total sense as a short-term coping move. But it means you’re making decisions, about pricing, about bookings, about how many client visits you say yes to, without the actual numbers in front of you.
The avoidance feels like relief. It’s actually just delayed discomfort, usually with interest.
One small thing to do this week
Here’s the action. This week, just write down your actual monthly driving costs as they stand right now. Not to fix anything. Not to panic. Just to look.
When you put a real number on paper, it stops being a vague threat. Your brain stops catastrophising because it has something concrete to work with. The fog lifts a little.
BBC News reports that the RAC’s Simon Williams said these increased costs “will be passed on to consumers.” That’s worth sitting with too. You are not the only person absorbing this. The whole supply chain is adjusting. That doesn’t make it easy, but it does mean you’re not uniquely exposed.
And if you want help thinking through what rising costs actually mean for your pricing or your business finances, please talk to a qualified financial planner or accountant in your country. I can explain what’s happening in your head. They can help you work out the numbers.
This is information, not a verdict
A cost spike tells you something useful: your business has a cost structure, and external shocks affect it. That’s just true. It was always true. The pump just made it visible.
What you do with that information is the interesting bit.
If you want to understand more about the stories your brain tells when money gets tight, The Thursday Money Note, my free newsletter, is a good place to start. Each week I take one idea like this and make it practical. You can join it here.
Or if you’re ready to go deeper, The Money Story Method is my 12-week one-to-one programme for self-employed people who want to understand their relationship with money, not just manage a spreadsheet.
Either way, you’re not imagining the pressure. And looking at it clearly is always the first move.
Source: BBC News
Joel