How to cope with financial stress
Financial stress is emotional tension specifically related to money and is a real challenge for many people right now. When faced with any challenge we have to consider what we have the power to change, and anything that isn’t in our range of influence we have to acknowledge and then turn our energy away from that. In terms of financial stress, there are practical steps you can take to plan and manage your financial situation, prioritising what you spend your money on, accepting some temporary losses or limitations to your living standard. There are also emotional wellbeing steps you can take, investing time into managing your wellbeing and stress levels.
Practical Steps
Do a budget check-up
Many people are frightened of the reality of their finances, but until you fully grasp the situation, you remain powerless. Regain feelings of control by taking charge of finances and budgeting:
Set aside time to understand what money comes in and goes out every month. List them down in a notebook or a spreadsheet to get full visibility. Keep a standard list of all the essential and regular monthly expenditure and what disposable income is left each month and budget to this. To make this last you need to make choices, for example, limit how many coffees or take away lunches you buy and shop in budget supermarkets
Decide what can you manage without in the short term? However, if you do reduce memberships that give you satisfaction and enjoyment, try and replace them with a similar but free activity you can still do. For example, cancel the gym (for now) but consider doing park run, or cancel a yoga class but find a free online yoga video to follow
If there is any way to increase income in the short-term then make a plan towards this. Perhaps you can sell things you no longer need on free apps or Facebook marketplace; others will be looking for bargains too. The job market has also changed, unemployment is low and people do change jobs more readily in today’s employment market
The downside of contactless cards and not taking receipts (which is fast becoming normal), is that we lose sight of expenditure. Write down everything that you spend on a running total list so that you can see when, where and how quickly you spend money and where your weaknesses lie. Make a commitment to sticking to your budget
Educate and include your children
Children become used to certain treats and may complain when these are reduced, but, you can use this time to educate them now about finances and choices so that they have essential skills for their adulthood. Try not to worry them, but see it as building important life skills. Make a game of finding fun free things to do, which might even mean more 1:1 time with them.
Understand debt management and the debt cycle
If the reality is what you fear and there is not enough to pay for everything and your debt is growing, you can take steps to reduce payment demands on you:
Speak to mortgage providers, local councils, landlords, utility companies, credit card companies and anyone you make regular payments to, to help you put reduced or delayed payment plans into operation
Contact debt management organisations or charities, such as Step Change or the national debt helpline who will help you understand your rights and what steps you can take. The Citizen’s Advice also have helpful advice
Understand how interest works and debt mounts. Pay attention to interest rates and pay off the highest interest charging debt first
Wellbeing steps
Financial stress can soon spiral because of the catastrophic consequences that we can imagine when we feel unable to provide for ourselves and our family. Being able to manage stress is vital in remaining reasonably calm so that you can think straight and not allow worry to take over your life.
Learn how to manage your financial worries. Identify what the worries specifically are when they arise, and write them down. Decide if you can take any action right now. If you can, then make a plan to sort it out and take action; this might be one of the budgeting steps above. If you can’t, remind yourself that you have done what you can and then commit to taking your focus away from that worry, letting it pass, and re-focus on whatever you are currently doing in the moment, putting all your attention on that
Seek support from friends and family. Don’t suffer alone and use your support system to gain fresh perspective or ideas that might help. You don’t have to go into detail but sharing part of your problem can relieve some of the worry and feelings of isolation that financial stress can bring
Practice relaxation techniques. Relaxation techniques will help put you in a calmer physical state, that will also aid your mental state. Try these Breathing and Mindfulness techniques to get you started
Practice good self-care. This is an often overlooked but important part of mental fitness generally and especially during difficult times. It allows you to get what you need to keep physically and mentally well, to care well for others in your life, and offset the build up of stress. Some ideas are suggested in this self-care wheel and I would encourage you to check this out, but ensuring you get good sleep, sound nutrition and regular exercise will give a good foundation on which to build
Resentment and anger at the moral standards and decisions at political levels in the UK and across the world naturally add to the feelings of stress that we hold, but we can only remind ourselves that this is out of our control and focus on what we can impact, and live our lives true to our own values and make a difference when and where we can.