Do worries about your financial situation keep you up at night? Stress about money can make it hard to sleep or keep your mind focused on the task at hand. It can even make you feel physically ill.
So, how does money cause stress? When there isn’t enough money in your bank account to pay the bills, you may have to make some tough choices. You might worry that you don’t have the financial savvy or skills to meet a big savings goal, like buying a house or sending your child to college. You may have a debt payment coming up that you just aren’t prepared for. Or, maybe you just have an overwhelming awareness that you simply can’t afford the things you would like for yourself and your family.
We all stress about money at one point or another. This kind of worry may leave you wondering how to stress less about money. Reducing your stress can improve your health and mental well-being—and help you sleep better at night. Want to stress less, particularly about money? Try out some of these life hacks and tricks!
1. Give Yourself a Break
Recognize your feelings of stress and shame, and consider why you are so stressed out about money. And then give yourself some compassion. Stop blaming yourself for money problems, even if they are a result of past mistakes or misunderstandings. You can’t change the past, but you can move forward. Being too hard on yourself isn’t going to fix your financial situation.
Take care of your mental health so you have some clarity to address your financial troubles. Before diving into your spending habits, try these free or cheap methods for de-stressing:
- Meditate and practice deep breathing
- Exercise regularly, even a simple walk around the block
- Take a hot bath
- Spend time with loved ones
- Go to bed early
- Listen to music that makes you feel happy
- Write in a journal
- Do something creative: draw, sing, dance, organize
Also, set boundaries on your work hours. You may be tempted to pick up extra shifts or work long hours to make up for financial stress, but while you’re learning how to stress less about money, align your schedule so you have a little time to yourself.
2. Get Serious About Your Budget
Budgeting isn’t fun. But ultimately, making and strictly following a budget will help you get control of your finances and fight back that financial stress. Start by reviewing your bills and expenses each month. Are you spending less than you earn? Is anything left over to build your savings? If not, you may need to rethink how you are spending your money and make a budget that helps you cut back on non-essential purchases.
3. Track Your Expenses
Creating a budget isn’t a one-and-done deal. You have to keep looking at it, adjusting it, and adjusting your spending habits to fit into it. That means you need to track where you spend your money every month. Just staying aware of how you use your money will help you make better choices about what you buy and how much you spend. You can find an app to help you track and categorize your purchases, or you can do it manually with a spreadsheet or even pen and paper.
4. Make a Debt Repayment Plan
Unpaid debt can be a huge source of financial stress. Late or missing payments will drag down your credit score, and the interest, payments, and late fees will continue to accumulate. If you are struggling with debt, make a plan now for how to repay it. Having a plan in place will help lift a burden off your shoulders. You may consider one of these two common debt repayment methods:
- Debt snowball: Focus on paying off the smallest debt first while making minimum monthly payments on other debts. When that debt is paid off, move on to the next smallest debt, repeating until your debt is gone.
- Debt avalanche: Focus on paying off the debt with the highest interest rate while paying the monthly minimum on all other debts. Again, when that debt is paid, move on to the next one
5. Set Up Direct Deposit
If your employer offers direct deposit for your paycheck, sign up. That puts the money directly into your bank without passing through your hands. It also automates one of the most important parts of your personal finance habits: adding your income. You can even split up a portion of the check to go into a savings account. You may want to put some of your bills on auto-pay as well, so they will come directly from your checking account, and you won’t have to worry about making sure every bill gets paid on time.
6. Set Up An Emergency Fund
Some financial stress might come from worrying about what will happen in the future if you get hurt and can’t work, need to repair your home or car, or have an unforeseen medical bill. Offset some of that worry by setting aside money each month into an emergency fund. Keep that money in a savings account separate from your checking account, so you aren’t tempted to use it. The ultimate goal for an emergency fund is to have enough to cover your living expenses for up to six months. That might seem overwhelming, so start small. Set aside what you have leftover every month to meet small goals: $500 first, then $1,000, and up from there. Decide now that you won’t use the money for anything other than a real emergency.
If you are still wondering how to stress less about money, stop comparing yourself to those around you. And stop focusing on what you don’t have or the mistakes you’ve made in the past. Give yourself some compassion and self-care, and make one small financial change at a time.