Almost everyone faces money worries in their life. It is a common thing in society. Financial Anxiety refers to obsessive fear, especially for things involving money.
Several things contribute to Financial Anxiety. These things include unemployment, unpaid debts, utility/medical bills, inflation in grocery prices, etc. In Financial anxiety, you cannot cope with your finances because of low income/money.
Suppose this situation persists for longer. Then it can negatively or adversely impact your physical and mental health. This way, you can experience insomnia, appetite loss, tiredness, sleeping difficulty, mood swings, muscle pain, etc.
Financial hardships indeed lead you to worries. But if these worries escalate, it will become an anxiety disorder. By managing finances effectively, you can control stress, fear and anxiety. Get insights on coping strategies for financial anxiety in this guide.
Understand the Root Causes
Without knowing the root cause of financial anxiety, you cannot control it. Understanding the root cause will help you understand the real reason for financial anxiety. These root causes vary from person to person. Some of the potential root causes include:
- Unexpected Expenses
- Escalating Debt
- Loss of Work
- Mounting Bills
- No Saving
- Reduced Work Hours
- Housing Insecurity
- Food Insecurity
The list goes on. Each root cause requires a different strategy so that you can cope effectively. For instance, seeking proper employment can be a potential remedy if you have no employment.
Create a Budget
For a better escape from financial anxiety, budgeting is your go-to solution. Budgeting requires you to determine your sources of income and expenses. Later you can eliminate non-necessary expenses to add up to savings. Follow the designed budget for a specific period and monitor the change in savings. If not fruitful, then re-design it and evaluate your finances.
Follow these steps to design an effective budget:
Goals Identification: Understand the difference between your desires and basic needs. This will help you in better goal identification.
Set Up Goals: Determine the goal you want to accomplish. If you want to clear your debts or set up saving for a recreational tour. This step relates to goal identification as you differentiate your needs and desires in the true sense.
Estimate Income: In this step, you need to estimate total income. Consider and include all sources of income you have and add them up.
Evaluate Expenses: Determine your expenses on major to minor things or accessories. This includes rent, candies, gasoline, food, utilities, etc. Add all expenses to have a clear idea.
Set Up Plan: Keenly observe your expenses and see which expenses you can cut off. Or where you can add up saving. Are you utilizing discount codes or coupons? What else can you practice reducing expenses? In this step, cut out as many expenses as possible for maximum contribution to savings.
Tracking Expenses: Keep a record every time you spend money on anything. This will help you with better track of expenses.
Evaluation: In the end, there comes evaluation. Note down if you are spending more than your budget. Have you forgotten to include that thing while budget designation? Tweak your budget again, undertaking that forgotten thing or expense.
The following sheet will assist you in preparing your budget.
Having a budget design will prevent you from facing anxiety and stress. It will help you enjoy complete peace of mind.
Plan for Emergencies
A financial emergency can happen at any time to anyone. This emergency refers to the income loss or expense that you don’t have any idea about it happening. It can play a great role in your financial destabilization. The following emergencies you can experience in your life:
Healthcare Emergency includes surgery, an accident, or severe illness. This affects not only your health but also financially. Healthcare expenses can be quite higher depending on the type of particular emergency.
Demise: Unexpected death of any family member, especially a family breadwinner. This can lead the dependents or family members to severe financial stress. The family members in this situation take up loans which push them into higher debt.
Loss of Job: As per recent studies by the KNBS (Kenyan National Bureau of Statistics), more than 1.7 million people lost their employment. This was mainly because of the pandemic. Such a situation can deprive you of daily expenses, rent or bills.
Natural Disaster: Natural disaster also results in financial emergencies. They can pose great property damage. For instance, this includes floods, earthquakes, fires etc. These disasters can lead you to face complete property damage or repair.
When you have a sufficient amount of saving on your end, such emergencies cannot put you into financial fear. This will help you cope effectively with the specific emergency.
Seek Professional Help
It is good if you can cope with your financial anxiety yourself. On the other hand, if you cannot do that, seek professional help in this regard. You can go to a financial therapist or advisor. Here is how a financial therapist can help you:
- He can assist you in differentiating stressors and behaviors that contribute to ineffective money management. With the help of a therapist, you can tweak such behaviors.
- A financial therapist can make you understand money dynamics linked to relationships and self-esteem. The relationships refer to family and friends.
- You can recover your financial issues with assistance from a financial therapist. This way, you can enjoy a sense of security regarding finances.
- A financial advisor assesses your saving and plays a great role in tweaking your spending habits.
Professional help greatly matters. After seeking professional help, you can change your perspective on your financial management.
You can refer to mindfulness, staying and focusing on the present moment without thinking of the past and future. Mindfulness refers to keeping your vision on top of your mind. Later use your vision as a guiding principle for better assistance in financial decisions. By highlighting the key essentials in your finances, you can use mindfulness to accomplish financial goals.
You can practice mindfulness by adopting the following activities:
Value Positivity: Thinking positively helps focus attention in the present moment and brings good thoughts to mind. You can prevent yourself from losing yourself in the future and past.
Body Assessment: Keep an eye on your body functions in severe tension. Do you experience a rise in heartbeat, pain, and aches? Note down if paying attention to your body eliminate these scenarios or not.
Focus on Your Heart: Emotions directly correlate with body communication. Staying happy bring in good thoughts and boos your activity in the current moment.
Utilize Your Senses: If you get lost in the past or future, utilize your five senses. Notice the surrounding sounds, people activities, noises, and any fragrance in the air. This will pull you back into the present moment.
Adopt Centering Exercise: The exercise is tuning to your body and mind. You can adopt 30 seconds centering exercises on keeping up the mindfulness.
Eat Better: The food greatly keeps you active, sound and healthy all day. Alter your food or diet to a more nutritious one to experience better mindfulness.
Adopting these activities in your daily life will allow you to reduce financial stress, anxiety and fear. You can pay more attention to your work and perform effectively and efficiently om duty.
Avoid Negative Triggers
The negative triggers adversely impact you’re focusing attention activity. Several things contribute to these negative triggers. For instance, these include constant and consistent news consumption and extensive social media usage. This boosts anger and fuels tension, arguments, mood swings, and anxiety.
You can protect yourself by keeping yourself away from these negative triggers. This ultimately allows you to pay attention to your financial goals effectively.
Action matters the most, and you cannot experience a big change if you don’t act. Setting up smaller steps and accomplishing them will keep you moving. You can do so by setting up smaller goals leading up to bigger ones. Celebrating the smaller goals accomplishment will help you achieve bigger goals and keep you motivated.
Surround Yourself with Supportive People
The linkage to a non-supportive or leg-pulling community can do a lot of harm to you. So, you should change your community if this is your case. The right people encourage you and offer better guidance and accountability.
This will promote a sense of security among you and relieves you of stress and anxiety. You will start thriving and enjoying your life in a better sense. Because supportive people ensure happiness and keep you away from sadness and sorrow.
Waking up all night or worrying about finances does not fill your bank account. Also, you cannot add up to your savings this way. Rather learning the tactics of effective financial management and acting upon them is your one-stop solution. This can assist you in staying calm and reduce your fears in the long run.
Staying calm will lead you to enjoy more control over your finances. This way, you can improve your budgeting and saving skills. Share your thoughts in the comment section, whether you find the above article useful. Contact us anytime for qualitative assistance with your queries or questions.