4 Tips for Minimizing Financial Anxiety
If you’ve woken up in the middle of the night to a money-related panic attack, you’re not alone. Our financial situation dictates so many parts of our everyday life. That said, excessive stress is a concern that should be addressed.
Money-driven anxiety is a growing concern in this uncertain economy. Ignoring your finances entirely isn’t the solution, nor is excessively fretting over every aspect of your finances. So what can you do to ease the burden of financial anxiety?
Avoid the Comparison Trap
People tend to post the best version of themselves on social media. Try not to let this facade of vacations, dining out, and luxury items fool you into thinking that’s how everyone lives. Trying to keep up will likely only get you so far. Avoid stretching yourself to present a skewed image of your lifestyle to others.
There’s also a private element beyond these posts that goes unmentioned. We don’t see the time or commitment some people put into their careers. Some people, like influencers, may receive gifts from companies and may not be spending their own money on the trips/clothes/etc. they’re posting. There could also be plenty of debt as a result of maintaining this supposedly ideal lifestyle.
Instead of getting caught in comparison, try to focus on what you need to be happy. Understand what you need, create your own goals, and measure your progress against your past self.
Start an Emergency Fund
It’s common for financial stress to stem from picturing the worst-case scenario.
“If I lose my job, how will I pay my bills?”
“What if a family member gets sick or injured?”
“Can I afford to fix my car if I get in an accident?”
While being aware of the worst possible situation can be constructive, fixating on it can be unhealthy. By preparing an emergency fund, you may reduce stress during unforeseen circumstances. Try tying this fund to your monthly budget to start building on something to lean on when something pops up.
Try Spending Socially, Not Materialistically
We accumulate possessions, they become old, we want something new, and the cycle continues.
According to research from the McCombs School of Business at the University of Texas at Austin, participants were happier when they spent money on experiences versus material possessions in every category, regardless of how much the item cost.1
Try spending money on an experience with the people you love. Our closest relationships are often what ultimately make us happy.
Continue to Educate Yourself
Financial professionals can review your entire financial picture or provide guidance in a specific area of concern. They can be great resources, and some even offer no-obligation initial meetings to discuss the basics of your financial plan, a good first step towards lessening the load of anxiety.
You can also do your own research, but be mindful of biases, conflicts of interest, and the sources that resources use. Ultimately, it’s your money, and you may feel more comfortable when you understand where you are financially, and what you can do to pursue your goals.
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