Finance

How to Keep Cool in Times of Financial Stress

How to Keep Cool in Times of Financial Stress

Over the past few years, the world has seen some major changes. From the pandemic to record inflation rates, the market has been one of unpredictability and uncertainty. 

People are facing tough financial pressures, and an April 2022 Bankrate survey revealed that 42 percent of adults said money concerns hurt their mental health. That number is actually higher for women and lower-income people. 

Financial stress can cause a feeling of anxiousness, cause you to lose sleep, and negatively affect both your mental and physical health. Facing future insecurities can also compound those side effects and take a massive toll on your well-being.

While a lot of financial stress and insecurities are external factors, there are some things you can do to improve your financial stability and security. Doing so can also help manage your overall financial stress and well-being during trying times.

Prioritize What You Can Control

You can’t change everything that’s causing you stress, and some things are out of your control. Worrying about those things will likely cause you even more anxiety and stress as you get frustrated with not being able to change them.

Rather, focus on the things you can control and take action on. For example, you can take the necessary steps to save some money in an emergency fund. This way, if something were to happen with your job or there was an issue with your home, you would have money in the bank you could use.

You can also create a monthly budget, so you know where all of your money is going. Address areas such as your groceries, eating out, entertainment, and subscriptions. By seeing where your money is going, you can figure out some areas you may be able to cut out or significantly reduce. This way, you’ll save more money and feel a sense of accomplishment as you take action over your finances.

Find Ways to Earn More Money

While budgeting is important and a great first step in securing your finances, you’ll also want to take a look at earning extra money if your budget is tight with the essentials. Rather than having another source of stress, consider looking into additional ways to earn money.

An easy way to earn extra income is to take on a job with Uber or DoorDash. With these options, you can choose when you work and don’t have to worry about a time-consuming second job. Another great option is to look into dog walking or dog sitting.

An out-of-the-box option is to take on another job working remotely. A part-time role you can do either after a work day or on the weekends is a great way to increase your income without having the added stress of a commute or figuring out when you would do additional work.

Pay Essential Bills

Bills are one of the biggest stressors people face. When you’re bombarded with so many of them, it can feel overwhelming and stressful trying to figure out how to pay them all off. The best thing you can do is prioritize which bills are essential for you to pay right away.

For example, bills that pertain to your living environment, such as power, gas, and water, are ones you’ll want to prioritize. Others, such as bills for fun things like Netflix or Hulu, are ones you can eliminate. 

By sorting through your bills and figuring out which ones are essential and which aren’t, you can get a clearer understanding of where you can reduce your financial anxiety.

Save Money Where You Can

Creating a savings plan is essential to lessening your financial stress. Don’t set unrealistic expectations, such as saving $10,000 in 3 months. Rather, take a realistic look at what your income is, and figure out how much you have left over after paying your essential bills.

From there, set up automatic transfers from your checking account to your savings account with the amount you calculated, so you’re actively saving money every time you get paid, and you don’t have the temptation to spend it. Once you’ve built up an emergency fund, you can also consider putting extra savings into a certificate of deposit to continue to save more.

Another important aspect of saving money is taking a look at the goods and products you’re buying. Something may be cheap, but if you constantly have to replace it, you’ll end up spending more in the long run than if you paid more upfront for a higher-quality item.

For example, if you’re looking into finding the best type of mattress, so you get a good night’s sleep, you’ll likely want to pay a bit more upfront for one that will get the job done versus one that will leave you with an aching back. This same principle can be applied to other items such as coffee makers, clothes, shoes, and more.

Track Your Money-Saving Progress

You won’t know if you’re making progress and hitting your goals if you aren’t actively tracking it. Put together a spreadsheet that you can review once a month to see if you’re on track for your goals. This way, you’re able to feel a sense of accomplishment if you’re on track or make adjustments as necessary if you’re a little behind.

Set a reminder every month for you to review; that way, you’re always aware of where you stand financially. It’s also a great time for you to review your budget and make sure that it’s being followed and updated.

Keep Calm and Save On

Financial struggles can be a major source of frustration and anxiety and can negatively impact your overall well-being. Take steps to get control over your financial situation by figuring out a budget and plan for saving, then stick to it. It will take time and feel like slow going, but saving every month and getting into good financial habits will ensure you hit your goals in no time.

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