How to Keep Financial Stress from Taking a Toll on Your Mental Health
Financial Stress & Mental Health: How to Ease Your Anxiety
Many people deal with financial concerns these days, especially considering the current uncertainties of today’s economy. So it’s understandable if you’re feeling stressed about your finances and losing sleep over it. But you must remember that worrying too much doesn’t solve the issue—it only takes a toll on your mental health. Setting a plan to manage your financial challenges and ease your stress is better.
So if you’re in a challenging financial situation, here are tips that may help you:
Specify the top sources of your financial stress.
When financial anxiety starts to weigh on you, it’s easy to feel overwhelmed. You can better control the situation by taking the first step of identifying the specific sources of your financial stress. Is it your credit card debt? Are you more worried about paying your upcoming utility bills? Or do you have outstanding hospital bills?
To make things a bit easier, list down your top sources of financial stress. You can keep the list short by writing only those money matters that need to be urgently addressed. You can always revisit this list to cross out accomplished items and add challenges you didn’t include before.
Prioritize what you can control.
You can’t change or address everything that stresses you out. Some things are merely out of your control and will only cause you even more stress over time. So instead of dwelling on things like that, focus on matters you can change or improve.
For instance, if you’ve decided to work on your credit card debt since it’s your top source of financial stress, one of the first few things you can do is cut some expenses. You may not cut one expense by $500 a month, but you may identify five that you can cut by $100 each. How to do that exactly? Here are some steps:
- List all your monthly expenses and categorize the items into needs and wants.
- Focus on your “wants” list and look for items you can trim. For instance, if you’re subscribed to multiple video streaming sites, how about sticking to one for now?
- Evaluate your spending patterns to find ways to save on small daily expenses. Maybe, you can bring packed meals to the office instead of dining out during lunch. Or skip drinking Starbucks & brew your coffee at home instead.
Look for more ways to earn money.
You can only do so much with budget-cutting, and you have to be mindful that tightening your budget won’t be a source of additional stress. So don’t stop at saving on monthly expenses—and find more ways to earn additional income.
Ask your employer if you can work a few extra hours each week. If that isn’t an option, find other possible income sources. If you have video editing, writing, or social media management skills, you can apply for online jobs through platforms like UpWork & Fiverr. You can also be a food delivery service provider. And with the hybrid work & class setups today, many families now have less time to work on their household chores than before. Such customers are willing to pay someone to do a grocery pickup, tutor their children online, or mow their lawn. You just have to find opportunities where you can share your skills and earn some bucks.
Be strategic about reducing debts.
Have your credit cards piled up? While cutting expenses & earning more money, don’t forget to create a strategic plan to pay them off. Do you have balances on multiple cards? Try the snowball method. That is paying off the cards one by one, prioritizing the smallest balance first. You can also try the high-rate method or pay off the cards with the highest interest rates first. But no matter which method you choose, be sure to make the minimum payments on the cards that are on the “less priority” list to keep late fees & other charges at bay.
Do you have a three-year-old loan through your self-managed superannuation fund or SMSF? Consider loan refinance. Refinancing your SMSF loan can free up cash flow and lower your monthly repayments, saving you some money. You can also do the same with your mortgage or car loan. But talk to a financial adviser before deciding on such measures to ensure you’re making the right move to reduce your debts.
Dealing with financial stress isn’t easy, but you have to start somewhere. Otherwise, you will find yourself in a deeper and more challenging financial situation. With these tips, we hope you can ease your stress and have better mental health these days.