When I was a kid growing up in New York City, I would go to the candy store after school. More times than not, I’d end up running out of money before the end of the week and would be the only kid with no snacks for the train ride home. And worse, I knew there was no way out of my predicament because asking my mom for more money would only gain me a stern look and a reminder that “money doesn’t grow on trees.”
Back then I thought the frustration I felt towards my classmates and their junk food boon was just a matter of being jealous that I couldn’t have what I wanted. Now, as an adult, I recognize what I was feeling then as something very much akin to financial stress–a feeling of anxiety and worry caused by our finances.
According to American Psychology Association’s 2017 Stress in America survey, 62% of Americans said that money is one of the top sources of stress in their lives and that they feel stressed about money all or most of the time. In fact, money has been at or near the top of the list since the survey was first created in 2007.
There are a lot of moving parts when it comes to personal finance, which can be incredibly stressful. Then when you add in the financial upheavals that are sometimes just a part of life, the potential stress only compounds. But there are strategies that you can use to help handle financial stress so that you can focus on moving your finances forward.
Identify the Parts of Your Finances That Are Causing You Stress
The first step in improving any situation is to figure out what’s causing the problem. If you are feeling financial stress, try to think about where it is coming from. The stress may be a symptom of something else–some larger concern that you have about your finances.
Keep in mind that the underlying cause may not necessarily be obvious. Sure, you’d know what was causing your stress if you suddenly lost your job or your car needed a new transmission. But it could also be something that’s more subtle, like the nagging guilt that can come along with overspending.
By identifying and focusing on that hidden concern, you can create strategies to help you work through the issue and prevent those stressful feelings in the future. Once you have a plan to address the financial concern that’s causing your stress, your stress level will go down too.
Focus On Just One Thing At a Time
To put it mildly, personal finance has a lot of layers. This can easily lead to stress-inducing overwhelm. There’s the day to day of earning money and paying bills. Then there are the intermediate goals like having a wedding, buying a home, and maybe even having kids one day. And then there’s retirement planning. It’s not surprising that trying to navigate through all that can cause some internal tension and analysis paralysis.
Instead of thinking of all of the things that you need to do and becoming overwhelmed, focus on just one thing at a time. Pay one parking ticket. Open that new savings account for your home buying fund. Use Turbo to check your credit score and see where you stand financially.
Just pick one thing and do it. Making one financial decision at a time helps to reduce decision fatigue. And breaking down your financial concerns into smaller tasks makes big financial hurdles feel so much easier to handle.
Get to Know Your Finances and Make a Plan
When your finances feel like they are out of control, it can be tempting to just avoid the problem. But burying the problem is not the same as solving it. Not knowing exactly where your finances stand will only add to your stress level in the long run.
The more you know about your finances, the easier it will be for you to create a workable plan to help you get where you want to be.
The first step to creating a workable plan is to figure out where you are. So start by gathering all of your financial records including pay stubs, bills, and credit card statements. Then create a budget, if you haven’t already. If you have a significant other, sit down and have a #RealMoneyTalk with them so that you can both be on the same financial page going forward.
With your budget in hand, you’ll know how much money you have to work with every month. Then you can create a realistic plan that helps you take control of your finances.
Check in with a Money Buddy or Financial Professional
Personal finance is personal, but that doesn’t mean that you have to go it alone. If you are feeling stressed about money, having a heart to heart chat with a trusted friend can help. Friends can offer much needed moral support and encouragement.
In addition to talking with friends, you can also reach out to a financial professional for help. Your financial situation might be challenging for you to navigate, but a good financial advisor can help you plan a way forward and then keep you clear of issues in the future.
Celebrate the Small Wins!
Most of us have a tendency to only celebrate when we actually hit our goals. Like finally saving up that three-month emergency fund or buying our house. But the truth is that it takes many small victories over time to add up to those larger accomplishments.
Instead of waiting to celebrate when you hit that future target, take time to celebrate the smaller milestones along the way. These mini self-pats on the back will shift the focus away from how far you still have to go–which could contribute to feelings of stress and overwhelm–and help you to appreciate how far you’ve already come.
Remember That Net Worth Does Not Equate to Self-worth
It can be really easy to fall into the trap of measuring your overall success or hinging your happiness on the amount of money you make or how much you have in the bank. Though keeping track of your net worth can be a great motivational tool to help you reach your financial goals, remember that there are many ways to measure what a successful and happy life looks like for you.
Financial surprises happen in everyone’s life and it is important to know how to cope if you’re feeling stress from the situation. Stay positive and focus on planning your way to your future goals, one small step at a time, to keep financial stress under control.