Five Ways to Combat Money Stress

If you’re feeling stressed about money right now, you’re not alone. A 2022 study from the American Psychological Association found that 65 percent of respondents felt that finances were a significant source of stress. 

After dealing with high inflation, increasing interest rates, market instability and a global pandemic, it’s no surprise that many of us have felt overwhelmed the past few years. The good news is that there are ways to combat that stress, regardless of what your current situation might be. 

Here are five strategies for cutting down on that money stress, so you can stop panicking and start making a plan:

1. Acknowledge your backup plans and celebrate your wins

When your finances take a hit, it can be easy to spiral. One bad month or bad year can make you start to feel like you’re digging yourself into a hole.

But here’s the upside: there are so many ways to improve your financial situation. They might not all be easy, but they’re still available to you. If you find yourself starting to panic, shift your focus away from what’s going on, to all the things you can do to get back on track. I talk about some of those options in my “How to Adjust Your Financial Plan” post.

It’s also important to take note of what’s going right, and what you’ve done well. Acknowledge all the wins, both big and small, because that’s what’s going to keep you going when things get tough.

2. Money stress: Take an honest look at your situation

One of the first things people tend to do when they have money stress is to look away. Seeing their situation spelled out in numbers can feel scary, so they end up avoiding it altogether.

The truth is, no matter how disappointing the numbers might be, they’re still much better than a vague guess. The actual numbers might not be as bad as you thought, or you’ll have a much clearer idea about what you have to do next. So open all the credit card statements, look at your accounts, and move forward knowing you have the full picture in mind.

3. Stop comparing yourself to others

Here’s a tip for good times and bad: stop comparing yourself to others. Watching others and trying to adapt your plan to theirs is a surefire way to get you off course. For example, just because everyone in your circle is buying real estate or investing in cryptocurrency, doesn’t mean you should, too. There are many paths to financial success, and you have to find your own.

If you do want guidance on getting there, try enlisting a Certified Financial Planner™ Professional who will help you create a plan catered to your needs and goals. 

4. Set yourself up for success

If you’re feeling stressed or dissatisfied with your money management, chances are you’re doing something that isn’t working. 

For example, if you tend to overspend, putting some boundaries in place can be a huge help. Try setting up automatic deposits to savings accounts, find a budget that works for you, or enlist an accountability partner to help you stay on track.

On the flip side, maybe you’re a super saver who isn’t investing as much as you should. Challenge yourself to invest more (if it makes sense for your situation,) or work with a CFP to grow your money even more.

5. Let go when you need to

Goals are great, and they can help you make real progress in your financial life. But they’re not always practical.

Given the strange circumstances of the past few years, your money situation might be looking a little different than you thought it would – and that’s okay. Getting down on yourself about falling short can backfire, making you feel like you’re not getting anywhere with your money. Remember that it’s perfectly normal for there to be ups and downs in the markets and the economy, and you’re likely going to see those fluctuations reflected in your own portfolio. 

If you’re feeling behind or feeling defeated, start back at the beginning of this list: look at where you are, appreciate what’s working, and build a plan from there.

About Your Richest Life

At Your Richest Life, Katie Brewer, CFP®, believes you too should have access to financial resources and fee-only financial planning. For more information on the services offered, contact Katie today.

The post Five Ways to Combat Money Stress appeared first on Your Richest Life.

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