One of the major causes of stress for most Americans is money. It was cited as the number one cause of stress by a survey conducted by the American Psychological Association in 2014. Almost 75% of Americans feel stressed about not having enough money, this stressor is closely followed by two other factors: work and the economy which are again related to money.
The biggest stress was in relation to finding money for unexpected expenses as well as paying for essential items and saving up for retirement. All this stress is known to have a really damaging effect on your health and overall well-being and this can lead to:
- Muscle Tension
- High Blood Pressure
- Drug or Alcohol Abuse
Money stress is something we all need to be aware of and finding ways to reduce this stress is definitely worth considering. There are some steps that you can take to reduce money worries and the following points should help you improve your stress levels.
Have An Emergency Fund
The survey pointed to the biggest worry of not having money set aside to deal with unexpected events or bills such as the boiler breaking down or car repairs. One way you can reduce this worry is to ensure you have an emergency fund.
An emergency fund is an account that is set up and funds transferred into this account to be used in emergency situations. This provides a sense of financial security and a way to meet expenses that are unexpected and prevents the need to use high interest debt like a credit card instead.
An emergency fund should contain enough money to cover between three to six months of living expenses and it’s something you will need to set up yourself. A checking or savings account can be used but make sure you make it an account that you can access quickly in emergency situations.
Don’t Follow The Trends Of Others
It’s tempting to try and keep up with friends, family or co-workers in terms of nice things they may have, places they go or hobbies and interests they may be involved with. We assume if we move in these circles that we should follow their lead and have the latest new gadget, a brand new car on the drive or join them in some exclusive gym or club.
However, you don’t have the first clue about their financial situations and even if you earn around the same amount of money, many people don’t go around discussing the ins and outs of their debts and cash flow problems. It’s important that you spend your time concentrating on your own situation and the things that are important to you and your family instead of focusing on what others around you are doing.
Understand What You Can Control And What You Can’t
The third major financial stressor in the USA is the economy and this is something that most of us have no control over whatsoever. A lot of people worry about the state of the economy and how it can affect their personal circumstances focusing and worrying about something they can’t control. There is no real point in worrying about these things and there are things you can do to manage your own personal financial situation – that is something you can control. If you have a long term plan, an emergency fund and are able to save some of your money then you’re on the right track – these are things you can control. The stock market, interest rates and the fluctuations in the economy are outside of your control so try not to worry about it.
Create A Budget
An important way to control your finances is to create a budget. This helps you to see where your money is going, what money you can save, how to plan for expenses and how to pay for all your bills. If you have no idea what’s happening to your money then it’s hard to feel like you have any say in what happens to it. If you create your budget it will help you to feel more in control of your money and put you in a better position to manage it.
Save For Retirement
A little money saved regularly over a long time is one way that you can start saving towards your retirement and with a little bit of smart planning you can make sure that you create a nest egg for your future. Building a retirement fund takes more than a few years of contributions and determining how large your nest egg can grow will depend on how long you can save for and what financial pressures you have to deal with throughout life. If you can start saving a little in your early working life it’s better than trying to pay larger amounts later in your career. With time and regular small amounts of savings you can start working towards your retirement today.
There are things you can do to control your situation and help you to make changes to your financial situation. The things mentioned in this article are a start to your personal financial control, independence and money management. If you follow these suggestions you will find that your stress can be reduced and that your health and well-being will benefit from controlling what you can and letting go of what you can’t.
Here’s a video that may help you reduce the stress of money: