It is important to manage financial stress early on and not let it linger because it affects a lot of areas in your life. It does not only affect the way you manage your money but it can also affect relationships, your goals, and even your job. There are also instances when stress manifests itself physically meaning you can get sick.
The American Psychological Association states that 6 in 10 Americans are stressed about politics a lot of them are concerned about the future of the nation. That may not be what you are concerned about and you are stressing about other small things. The point here is that regardless of whether it is a matter of the future of the nation 12 or what you will eat tomorrow, stress affects a lot of people.
Why are they stressed?
Talking about the reasons why people are finding themselves trying to manage financial stress, here are some of the most common reasons behind it.
According to Maryland sociology professor Philip Cohen, the divorce rate in the country actually dropped 18% between 2008 all the way to 2916. This is primarily because a lot of younger people take their time getting married. This is in stark contrast with baby boomers who married early and married often.
However, a lot of people still go through a divorce and that is one of the biggest reasons for financial stress. As much as there are emotional and even physical stress, the financial aspect of separation can also take its toll on people. When the time comes to talk about separation of assets and even child support, it can be a very stressful time.
One of the reasons why people need to manage financial stress is when they lose their jobs. This was a big problem in 2008 during the Recession when the housing bubble burst. Not only did a lot of homes were lost, but jobs were also hard to come by. A lot of people lost their jobs and trying to find one was a challenge.
Losing your job puts a heavy strain on your finance especially if it is your only source of income. Once this happens, you will start to prioritize all the basic necessities such as food and shelter. This means that your car payments might suffer or even student loan obligations could be sent out late. This will start to affect not only your finances and budget but your credit score as well.
Financial stress can come also from having to cover your cost of attendance in college. There are a number of ways for students to lower down their student loans. They can look for grants, apply for federal student loans and even considering community colleges. Doing these things can help students manage financial stress. This is important as Forbes shares that the 44 million borrowers in the country alone carry a $1.3 trillion student loan debt.
Retirement is an exciting stage in your life but the lack of planning can make it otherwise. Planning for it can also be a stressful time especially if you do not have an idea where you want to be when you retire. You do not know how much you need, what you want to do, or even the age when you want to retire.
What can they do to manage stress?
These are just some of the things that can cause financial stress in your life. Now that you have identified them, the next step is understanding what you need to do next. Here are some of the steps you can consider to help manage financial stress.
Plan for the future
One of the most potent ways to manage stress is to have a plan for the future. This helps direct all that tension and negative thoughts into a concrete and achievable goal. Rather than trying to worry what tomorrow will bring, create that future which you can work hard for today. This will guide you and help lower down your stress.
If you wake up scared every single day not knowing if you will get fired at work or not, why not start pursuing your own business. Look at the things you love to do or your hobbies and start from there. Start thinking of ways how you can convert that into a business. Soon you will be waking up excited and ready to work because you are doing something you love.
Create a positive habit
It also helps to manage financial stress when you create habits which help you improve your finances. One of them is saving money for future use. Regardless whether it is for your reserve fund, debt payment, or retirement money, you need to get into the habit of saving money. You need to understand that habits take a long time to form.
You can start by saving small amounts of money every week. Just put it in the jar or a box until it fills up and then you deposit it in the bank. There are even apps which can help you save better. Technology can be a great tool for improving your finances. The idea is to start doing actions that can turn into positive financial habits down the line.
Look for small wins
One effective way to manage financial stress is to identify and celebrate small wins. These can help give you moral boosts and make you more confident in reaching your goals. You need to start believing in yourself more because you alone can fix your finances. There are ways to help you take a more proactive approach to your finances.
You can look into debt consolidation or even settlement to make payments a lot easier for you and get those small wins coming. Once you work with a company to pay down your debts, you can start to feel those small wins come in. Collection calls will automatically stop giving you a sigh of relief and your accounts start to get paid. There are ways to get those small wins and you just have to identify the right debt repayment program for you.
Stay on track
It is important that when you are trying to manage money stress, you stay on track no matter what. There will be times when it seems like you can’t go on but you just need to look at them as lessons you have yet to learn. Times can get difficult but there will always be a solution and a way out of your problems and challenges you face.
If your goal is to pay off your student loans in three years, you need to stick to that plan. Make sure you always put aside and pay the amount you need to in order to pay everything off in 36 months. If you want to finish your mortgage payments 10 years before retirement so you can focus on saving for your golden years, stay on track and make those payments every single month.
It is possible to manage financial stress when you understand the reason behind it and be proactive in solving it. The sooner you address and work on relieving the amount of financial stress you have in your life, the better quality of life you will have.