Most people feel stressed about money at one point or another. Whether you’re managing your finances on your own for the first time, struggling to make ends meet or unsure how you will afford an unexpectedly large expense, there are plenty of reasons you might feel overwhelmed and unsure about money.
Shifting how you think about money and changing how you approach your finances can make a big difference. Taking small, meaningful steps forward might help you feel less stressed, more empowered and help you grow your financial know-how.
Let’s explore some ways to help shift your mindset.
Face your finances
While it may feel scary, facing your finances head-on is an essential first step. Avoiding looking at your full financial picture could be causing you more stress than you know, and you may even be better off than you thought. Even if you don’t have the best news, having the facts in hand is the best way to start moving in the right direction.
As you look at your finances, consider what exactly is causing your stress. Is it a low savings balance? Too much credit card debt? Not knowing how to stretch your paycheck every month? Being honest with yourself about where you stand and what steps you might take could help you feel more in control.
Make a plan
One of the best ways to manage any type of stress is to make a plan. Even though it can be hard to start, shifting your mindset toward action will empower you to make important decisions, such as changing your spending habits or seeking a personal loan to cover an emergency expense.
To get started, you’ll need to track the money you have coming in and going out. Write down the following information:
- Income (e.g., salary, self-employment, investments)
- Fixed expenses (e.g., rent or mortgage payments, insurance payments, streaming subscriptions, gym membership)
- Variable expenses (e.g., dining out, utility bills, medical bills)
- Outstanding debt (e.g., loan payments, credit card bills)
Once you have a master list of your expenses, note which costs are necessary and which ones are optional. This can help you prioritize your spending.
Here are some additional steps you might take once you have this information handy.
Create a simple budget
Making a budget could help you better allocate your income to cover your fixed expenses. A budget can help you clearly see where your money is going, reveal ways to better align your spending with your goals and help keep you on track. For example, you might commit to ordering less takeout and putting that money toward your credit card bill instead.
Set realistic goals
Little successes can give you a sense of fulfillment and motivation to keep going. Whether you want to increase your income or find ways to save more, start small. Saving an extra $10-$20 a week is a goal that can make a difference over the long term.
Tackle debt
If you're feeling weighed down by debt, this might be a good place to start. You might want to look for ways to reallocate your spending in order to pay back money you owe sooner. If you’re juggling multiple debts, you might consider a personal loan to consolidate your balances into one monthly payment.
Prepare for the unexpected
One of the best ways to help boost your mindset and your bank balance is to create an emergency or rainy-day fund. Your emergency fund can be part of your savings account or a separate savings account. Either way, knowing you have extra padding available to you should you need it can help soothe your stress in the short term.
Instead of manually adding money to your emergency fund, try setting up automatic bi-weekly or monthly deposits from your check to your savings account through your bank.
Ask for help
If you don’t know where to start, or if your stress about money feels overwhelming, you could try asking for support. Oftentimes, communicating your concerns with someone else can help release stress.
A trusted friend or family member may be a good place to start. If you feel like you need more professional guidance, it may be helpful to reach out to a certified financial counselor or advisor who can help answer your questions and work with you to create a personalized financial plan.
Change your approach for less stress
Shifting your mindset isn’t just about being grateful for what you have or trying to stay positive during a challenging time — although those are important tools. Committing to facing your finances head-on can help you take steps to address the issues that are within your control.
Learning about your money, making a plan, preparing for the unexpected and asking for help could help reduce your stress, set yourself up for better money habits and open the door to greater financial security in the future.
Notice: Information provided in this article is for information purposes only and does not necessarily reflect the views of ceotodaymagazine.com or its employees. Please be sure to consult your financial advisor about your financial circumstances and options. This site may receive compensation from advertisers for links to third-party websites.
