Money is the second leading cause of stress amongst adults1. If you're worried as well, you're not alone - there are things you can do to make it better.
Financial stress can stop even the most productive people in their tracks, causing sleepless nights, avoidance of debt and denial. While it's best to talk to your financial professional about what's on your mind, here are a few tips to start managing your stress on your own.
Tip #1: Make a To-Do List
Sometimes the most effective techniques are the simplest. When it comes to overcoming your financial stress, start by putting your to-do list in writing. Creating a clear list of what’s ahead can help it feel more tangible and doable. If you can, start with the easiest tasks and slowly work through your list, checking things off one by one. With a to-do list in front of you, there’s no need to bear the burden of remembering everything in your head. Starting with a list of tasks can help you more effectively build a plan of action.
Tip #2: Try Talking to Someone
It can help to open up to a family member or friend. Keeping everything bottled up and to yourself is only going to escalate your anxiety. If you’re able to, talk it out with someone you trust and be honest. Discussing your problems can ease the burden significantly. Additionally, you can contact one of our financial advisors at California Retirement Advisors for help in isolating where your stress is coming from and strategizing how to manage it.
Tip #3: Review Your Spending Habits
Ignoring the situation may be tempting, but putting your financial obligations off will only make them worse. While some financial issues are more complicated than others, taking stock of your current situation can help build a better understanding of where you are today and what needs to happen. This often starts with adjusting your spending and saving habits. When it comes to addressing your current spending habits, there are a few things you can do right away:
- List out every income source you currently have
- Determine your debts (student loans, car payments, credit card debt, etc.)
- Keep track of all your spending manually or using a phone app
- Identify potential spending patterns or triggers (when you’re stressed, right after payday, etc.)
- Determine what changes you can make to your average spending to save more
- Avoid impulse spending
Tip #4: Make a Plan and Create a Monthly Budget
Creating and tracking a monthly budget is a great way to get in the habit of healthier spending - and healthier spending habits mean less financial stress.
To get started on creating your monthly budget, start by:
- Listing out recurring expenses such as gas, groceries, utilities, etc.
- Prioritize contributing to your emergency fund each month
- Set up automatic payments to avoid late fees or interest
- Determine where you may be able to cut down on spending (entertainment, clothes, etc.)
Tip #5: Establish a College Savings Plan
If you have a young one at home, paying for college is likely looming over your head. To ease this large financial burden, take the time now to establish or check up on your college savings or investment plan. You and other family members can contribute to a plan, which will gain interest over time as you set aside funds to pay for a child or grandchild’s education.
Getting your finances in order is no easy feat. Identifying your main stressors and establishing a plan to address them can make a big difference in how you and your family feel about your finances. If you’re feeling lost, confused or overwhelmed, please reach out to one of our financial professionals who can help make sense of your current financial situation.
By Christian Cordoba
CERTIFIED FINANCIAL PLANNER™
Founder, California Retirement Advisors
For more information on money mentality, check out this other article:
Investment advisory services offered through Mutual Advisors, LLC DBA California Retirement Advisors, a SEC registered investment adviser. Securities offered through Mutual Securities, Inc., member FINRA/SIPC. Mutual Securities, Inc. and Mutual Advisors, LLC are affiliated companies. CA Insurance license #0B09076. This content is developed from sources believed to be providing accurate information and provided by California Retirement Advisors. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. California Retirement Advisors, nor any of its members, are tax accountants or legal attorneys and do not provide tax or legal advice. For tax or legal advice, you should consult your tax or legal professional.