Money (how to make it, spend it, or save it) can be a huge stressor and most people find themselves stressed about their wealth at some point in their lives. Even if you have a secure income, you might find yourself feeling anxious about a particular money-related situation such as a loan or how much money your children would need if you were to pass away. How do you deal with financial stress when it happens to you?
Stress is your body’s reaction to situations that feel out of your control so the first step to dealing with financial stress is to identify why you feel the way you do. What is causing you to feel stressed about money? Do you:
- Spend more than you earn?
- Live from salary slip to salary slip with no plan for the future?
- Have a large amount of debt?
- Feel overwhelmed by having to manage your money (not sure where to start)?
Once you’ve identified why you feel stressed, use some of the following tips to help you cope and move forward:
1. Focus on the now
There is no point in going over and over why you are in the financial situation you are in today. If you are stressed about money, identify the cause of your stress and start working on it. Need to pay back a large loan? Get a repayment plan in place. Need more money? Start investigating a career move. Can’t get your spouse to curb their spending? Sit them down for a heart-to-heart.
2. Manage your debt and save
Debt can create enormous pressure, especially as most people slip further into debt before they get out of it, if they ever do. Put a structured repayment plan into place and stick to it. While some debt can be seen as necessary e.g. car and bond repayments, other forms of debt will just weigh heavily on you e.g. credit card debt. Get those paid off as quickly as possible. Use budgeting and financial planning to help you stay on track, and avoid major debt traps. Move beyond just servicing your debt and, as soon as you’re able, start saving – an emergency fund goes a long way to relieving the stress of wondering what would happen if you didn’t get paid for a month or two.
3. Tell the truth and get support
Stress is often worse when we keep a secret from the important people in our lives. Chat to your significant others about your financial situation and tackle the challenges together. Also, always be honest with your banker and financial adviser – they can only help you if they know exactly where you stand.
4. Protect yourself
Do you worry that you won’t be able to look after yourself or your family if you can’t work? Or once you retire? Following a proper financial plan, you need to have the right insurances and investments for your needs. If you save enough and correctly, and cover yourself against risks to your income, you can rest assured that, should the worst happen, you and your family will be protected against financial ruin. And know that, when you retire, you will be able to carry on living the lifestyle you desire.
5. Get professional advice
If you are stressed about your wealth because you don’t know how to manage it, educate yourself and then get the help of a reputable financial adviser who can help you put in place a wealth management plan. Financial planning requires knowledge, expertise, and experience so make sure you work with the best team you can.
If you want to stop stressing about money, take action.
Need help? Hire a well-respected financial adviser and ensure that they teach you about wealth management, including wealth protection and wealth creation.