How do you avoid panicking when you meet a native speaker?

[zKing]

When I was in Italy and my Italian was _just_ functional enough to communicate with, each time I'd call to make a reservation or something similar, right after the greeting I'd always start with a phrase like: "...mi dispiace, il mio Italiano è pessimo, ma voglio ..." (I'm sorry, my Italian is terrible, but I want ...) [to make a reservation, etc.].

I felt this helped me a lot because:
a) It was a canned phrase I knew how to say and it allowed me to get the conversation rolling in Italian. I was already "succeeding".
b) Since I admitted that my Italian wasn't great up front, it calmed me down and let the other person know I didn't have over-inflated expectations of my skill and I'd be speaking slow and need some help communicating... this took off a lot of pressure in my own mind.
c) It seemed like the self-deprecation also put the other person in a 'helpful' mode (although to be honest, almost all Italians I met were very warm and hospitable.)

But generally speaking, you are going to need to generate a LOT of mangled TL before you have any chance of generating much 'good' TL. Everyone who has tried learning a language has had that feeling of stopping mid-sentence and thinking:
"[FLASH OF PANIC] Oh my god! I don't know the word for ELEVATOR!...[FLASH OF PANIC]... he's smiling and nodding, but this pause is getting uncomfortably long... [FLASH OF PANIC]... I have to say SOMETHING!... [FLASH OF PANIC]...he thinks I'm a MORON!...[FLASH OF PANIC]..."

My tips:
a) Avoid starting up conversations with someone who is in a hurry or you would be slowing them down or getting in the way.
b) I try to ensure it is very clear I mean no disrespect or have some inflated ego about my skills. Self-Deprecation is useful here.
c) Do lots of iTalki/language exchange sessions: frankly, you just need to become numb to that feeling of falling flat now and then by falling flat a lot. This will greatly help with the panic spiral of death that can kill a conversation and make you kick yourself for the next month. Plus directly practicing conversations will hone your skills in circumlocution and help fill in gaps in your knowledge of common conversational vocab/phrases.
d) Let the other person help you and give yourself an out: I use phrases like "I can't remember/don't know the word..." a _lot_ in both my TLs.

To be clear, neither of my TL's are yet at an 'easy fluency' stage, so using them still takes a lot of hard concentration and there's always the fear (and reality) that my skills will fall short at times. But the truth is... this will happen a lot, and it sucks, but this is just part of learning a language. After a lot of practice you accept and get used to that feeling, the flashes of panic become much less intense and you learn ways of pulling yourself out of dead ends.

[philomath]

Thank you everyone for your great responses! I’ve concluded that I should:
- Actually practice having conversations more often, either imaginary ones or real ones with a native speaker.
- Have sort of prepared responses for common questions like why I’m learning Spanish.
- Let the native speaker know that my Spanish isn’t the best/that I’m still learning.
- Practice calming techniques like focusing on my breathing.
etc.

[Flickserve]

Thank you everyone for your great responses! I’ve concluded that I should:
- Actually practice having conversations more often, either imaginary ones or real ones with a native speaker.
- Have sort of prepared responses for common questions like why I’m learning Spanish.
- Let the native speaker know that my Spanish isn’t the best/that I’m still learning.
- Practice calming techniques like focusing on my breathing.
etc.

I think it is normal not to perform at your best.

Talking with a teacher is only a step towards spontaneous conversation.

The added complication is the sudden unexpected change of thinking from English to Spanish. Changing channels is not that easy unless you're used to it so no need to think you underperformed. Make sure you have your stock phrases of "could you say that again" , "can you speak slower", "I didn't catch that" at hand.

[Spoonary]

One thing I would recommend is preparing yourself to circumnavigate words you don't know. When you get to a point in a sentence where your mind is searching for a word you can't seem to remember/simply don't know, ask the person you're speaking to how to say it, without reverting to your native language/English (by using different words to explain/describe the thing you're talking about). I do this all the time in Spanish and it fills me with confidence to know that I can keep the conversation going no matter how shoddy my memory is.