If you feel obsessively worried and uneasy about your finances, you can be dealing with financial anxiety. In dire situations, thinking about your finances can bring a lot of stress and tension. If further avoided, it can leave you feeling limited and can lead to self-destruction.
But, fear not, we have outlined several quick methods to overcome financial anxiety and get back up on your feet to alleviate yourself from this situation.
1. Identify What is Causing the Stress and Deal With It
You can’t solve something when you don’t know what the problem is in the first place. Before you lay down those spreadsheets and cut off your spending, you’d need to sit down in your thinking chair, pause, and identify what’s causing your financial stress. Are you spending too much, worried about not saving enough, or just concerned that you will be a bit short in retirement?
When you know what you’re dealing with, you can create a plan and decide how long it will take for you to solve it.
This is a strategic way of attacking a problem so that when you know what’s troubling, you can think of the best way to eradicate it. Suppose you’re worried about not having much left at the end of the month. You can check on why this particular pattern keeps happening every time. It could be attributed to unnecessary expenses, extra spending, perhaps a mishandling of your budget.
2. Track your Spending and Avoid Temptations (i.e., Budget)
Some avoid this practice because they find it tedious, but it’s a great lifesaver. Part of your anxiety stems from this feeling of lack of control, and tracking helps you get that back. By knowing where your money goes, you get back on the driver’s seat and take the reins of your finances.
Here are other reasons why you should track your spending:
- It keeps your finances organized. Disorganized finances give birth to a whole set of problems that you don’t want to face in your life.
- It helps you track your progress. You’ll get to know your small wins, and it certainly is a big emotional booster when you see momentum in what you’re doing.
- It helps reveal your spending issues. If you want to know what causes your financial stress, look no further than your tracker. Chances are you’ll see it glaring back at you.
I’m a big fan of budgets, and I like it when I know where my money is going. When you have a budget, you control your money rather than your money holding you. A budget also helps you see your priorities and the expenses you need to anticipate, like rent, utility bills, groceries, and medicals.
Aside from tracking, one way to stick to your budget is to avoid temptation. Every person has a soft spot for something; for some, it may be clothing; others may be luxurious bags. Whatever it may be that you’re curbing your expenses from, you can avoid spending on them by averting your eyes from them. You can try walking on a different route away from the shoe store or uninstall the shopping app from your phone to resist adding more items to your cart. The point is, even if you trust your self-control, it’s better to prevent it before it happens.
3. Create an Emergency Fund
Here is one truth about life: it’s filled with unexpected events.
While others may be positive surprises, others take us down and may potentially leave us disabled. While we may not know when financial blows may happen, we can be ready for it.
Your emergency fund serves as your security blanket when life hits an unexpected mishap in the form of hospitalization, emergency house repairs, or being laid off from work. These unfortunate times, if left uncovered, may cripple you financially with more than you can handle, and unfortunately, may leave you in debt.
Here are other reasons why you should keep an emergency fund:
- You only have one source of income.
- You are saving for a goal, and you don’t want to dip into your savings.
- You’re living alone.
- You have underlying medical issues.
- You own a home.
- You have a car.
Lastly, there’s no such thing as being overprepared. Aside from covering up your finances, having an emergency fund gives you peace of mind, and that’s worth the price.
4. Develop a Money Mindset
Your money mindset is your attitude towards money. It’s how you react to your salary, your debt, and your investments. Basically, it’s how you view the role of money in your life. Do you think of it as an instrument to reach your dreams and help others around you? Or do you think of it as a tempting device to further you into ruin?
Part of developing a money mindset is to have a positive attitude towards money. When you have a positive mindset about your finances, you set financial goals to better your financial status. You desire a financially healthy future, and you take the steps necessary to achieve it. More importantly, you stop comparing yourself to others and stop spending money to impress other people.
Additionally, you are not afraid to talk about money, and you strive to be more financially educated. In a nutshell, you have a working and healthy relationship with money, and you use it as leverage in having healthy relationships around your family, partner, and community.
5. Ask a Professional for Help
Often, we have this stigma about asking for professional help. All of this is rooted in financial shame. We are afraid to be labeled as helpless or ignorant. The truth is, there’s no shame in asking for professional help. If anything, it would be a wise choice.
If you are deeply struggling with your finances, having a third party come in and see your situation from the outside lets you into a different perspective. It’s no secret that our emotions are tied with our finances, so there may be some old habits that we can’t give up.
Part of the reason why you should seek professional help is educating yourself, especially on financial matters. A recent study from IPSOS found that only 13% of American students were taught financial literacy and investing in schools.
This leaves 87% of people who have either no financial literacy or have had to find out about managing money independently. Asking for help should not be about feeling weak or ashamed; it should be viewed as making you stronger and better equipped to make financial decisions later in life.
Financial advisors are there to help all kinds of people!
Additionally, if you are not ready for speaking with someone, you can find some good books that teach you about financial literacy.
Bonus: Talk to Your Family, Your Loved Ones, or Your Partner.
Here’s a bonus tip: tell your circle about your financial hurdles. Of course, these should be the people that you trust most. For the most part, it’s alright to go through your anxiety alone, but it’s so much lighter to have someone within your crowd to talk about it.
Suppose you tell your partner that you’re trying to cut take-out expenses as it’s eating up your monthly budget. As a plan, you prepare your meals a day or two so you won’t get tempted to order food delivery whenever you see an empty fridge. Before you know it, your partner may be alongside you in the kitchen chopping up food for your following recipe.
Support is invaluable, especially when you need it the most, so don’t be afraid to open up and share.
No one wants to be in a position of financial struggle.
But if you are in that situation, don’t throw all your hopes away. By tackling your hurdles one by one and understanding the steps to get through your financial problems, you’ll be able to ride through them – with flying colors!