When it comes to finances, it’s easy to stress. Do you have enough saved? What if a costly emergency strikes? Will I be able to make ends meet? Will I have money for the future I want to lead? It’s normal for these questions to roll through our heads and for us to overthink and stress about them.
A study conducted earlier this year found that money is the number one cause of stress for Canadians. And the pandemic, of course, isn’t helping with that stress. Four out of ten respondents said that the COVID-19 crisis has impacted their financial stress levels. With our current living situations shifting to working from home, while juggling e-learning for your kids, and for some, losing their jobs, or having to give them up, it’s no surprise that 2020 has been more stressful than ever before when it comes to finances.
It’s important, however, that you don’t let stress completely control your finances. We know that sounds easier said than done, but here are some tips to help keep your stress in-check (and your finances).
Be willing to talk about finances
No one likes to talk about money problems. In fact, many people say it’s one of the three topics you should avoid (next to religion, and politics). Many find it uncomfortable, and shameful. However, willingness to push through that awkwardness and have an open conversation about your financial health will be your first step in getting it on-track. Being stressed about your finances can take a mental toll on you, and chatting with someone you trust (whether a personal or professional) can help you better process your emotions, thoughts, and next steps. You are likely probably going to be surprised to find that the person you are chatting to can relate in some way to what you are stressing about.
Review your household budget
Budgeting is incredibly important. Having a budget will help you see a clearer picture of your finances, and can make you feel less stressed about them because you’ll have more of a hold on where your money is coming and going. If you don’t already have a budget, we have a ton of useful guides here for you to get started. Step one is to create a budget, but step two is to evaluate your budget if you already have one. Revising your budget can help reduce financial stress. Take an honest look at where your money is going and decide how to shift those allocations to fit your current life. By doing this, you’ll be able to regain a sense of control you might currently not have.
Another area where you should be focusing on as you work through your budget, is focusing on your goals.Whether that’s saving more, spending less, or just cutting expenses, you have to ask what do you want to financially achieve? Save for something specific, create an emergency fund, or start to get savings in place for retirement? Having clear goals in mind and a plan of how you are going to achieve them will make you less stressed about your money because you’ll feel like you have a plan that you are in control of.
Lastly, you should be taking your debt into consideration in your budget. How are you managing it? Debt can be a financial burden and feel incredibly stressful. Especially when there is interest involved. Determine what your plan of attack is to pay off debt and get on track.
Take advantage of free training
One of the biggest downfalls of our education is that we don’t learn much about financial literacy. This can make us feel in the dark about our finances, especially when we are going through a tougher time. There are, however, a variety of resources out there that can help. Many of which are free. Try out some of the following:
- Take a mental health course to help get in control of your stress and anxiety. CAMH offers a Mental Health 101 series that can help you get on track
- Essential workers struggling right now during COVID can check out the MHCC’s Crisis Response virtual training
- There is also a variety of free courses in professional development, ranging in topics, available on Coursera. Consider taking one around finance
- Reach out to a financial advisor at your bank. They are free of charge and can be a great resource to help you get more in control of your finances
- Read blogs (like this one) and seek out online resources that are available to help you tackle your finances and feel in control
Avoid obsessively monitoring your investments
It can be scary to see your investments go through a downturn. But it is normal for the market to fluctuate. What can cause you too much stress is if you obsessively monitor your investments. Seeing those gains and losses can feel like an emotional rollercoaster, and make you question if you should be pulling out all your money to keep it safe (P.S. we don’t recommend this). If you are concerned about the fluctuation you are seeing, chat with your financial advisor/bank to better understand if your money is in the right place. After that, let it rest and set boundaries when it comes to how often you’re checking in on it.
Give yourself time to grieve
For many people right now, COVID has led to reduced income, depleted savings, and even the loss of a job. It’s okay to let yourself grieve your financial position changing. Give yourself time to process the change before making any big decisions. Validate your (or your partners) feelings. It’s okay to feel anger, frustration, and fear for the future. And you’ll be able to make more rational decisions on next steps once you’ve given yourself that opportunity to mentally regroup.
Don’t be afraid to seek help
Unfortunately lots of people still feel like there is a stigma around asking for help from a professional, but this can actually be so rewarding in the end (for both your mental health, and your finances). Speak with a financial adviser to ensure your banking decisions are rooted in logic (versus emotion). If you feel that your stress and anxiety around finances is impacting your overall wellbeing and mental health, speak to a mental health professional. These experts are there for a reason.
Seeking help may also be in the form of looking for options to help you get by when you don’t have a steady cash flow. For example, utilizing payday loans like GoDay, who provides help when you need it.
Create extra sources of income
It can be challenging to just stop stressing about money if you’re living paycheck-to-paycheck, or can’t cover your monthly expenses. To break that cycle, brainstorm ways to earn more income. Some ideas:
- Can you look into changing jobs to a higher paying one?
- Can you manage having a second job?
- Can you start your own business or side gig?
Think about ways to leverage skills you already use in your job (or personal life) to create a profitable project or side business:
- Teaching music, dance, or other art forms
- Caring for pets
Focus on the positives
For many, financial stress comes from projecting a worst-case scenario into the future. Remind yourself that you’re not in the future, and be present. Being present is where you’ll have the power to make a difference. It may sound cheesy, but keeping a positive attitude and using positive language when it comes to your finances can help reduce stress.
Tip: Try using “The Five-Minute Journal”, which is available as a book or an app and can give you space to note what you’re grateful for each day.
Stop comparing yourself
In this day-in-age, it’s really easy to compare yourself to what others have and what others are succeeding in. Your social media accounts are probably loaded with friends’ pictures of trips, cars, new houses, and other fancy things that you feel you can only dream about. Comparing yourself to what others have and are accomplishing will do nothing but cause you stress. As humans, we look at wealth, success, etc. as a measuring stick, using others to gauge our position, when in reality, constantly comparing yourself to others it not a healthy way to live (and won’t motivate you financially).
Here are some things to remember the next time you feel the urge to compare yourself to others financially via Money Crashers:
- You don’t know what’s in their bank account. While a friend might seem to enjoy plenty of success, it could be courtesy of credit cards and debts.
- You don’t see the hard work and sacrifice that goes along with financial success.
- Your friends’ journeys are not yours – your experiences are unique.
- Many people post the best version of their lives on social media, so perception can be skewed.
- Keep some factors in your life private, so you don’t feel the need to promote a perceived sense of wealth to your friends. While it’s okay to share pics from your latest vacation, boasting online is unhealthy and can leave you spending more to maintain the facade.
- The only person you can change is yourself. Instead of gauging your success by that of others, create a measuring stick by which you can feel more in control over your money, such as a healthy savings account and an accurate monthly budget. These can be more effective indicators of your wealth and success – not someone’s Facebook photo album.
Financial stress is very common, and you shouldn’t feel ashamed to have it. However, learning ways to take control of that stress will help you in the long run with feeling more confident and stable in your financial situation. What are some of your biggest tips for overcoming financial stress?