budgeting Archives - GoldenRules Financial Strategies

When Finances Become a Source of Stress

When stress is getting you down, take a moment to reflect on all the things you appreciate in your life, including your positive qualities and gifts. This simple strategy of gratefulness can help you keep things in perspective.

Most of us have financial obligations or expenses that we must take care of. Some of those include rent or a mortgage, maybe a car payment, credit card payments, and other needs such as clothing, and recreation. Sometimes these obligations can become stressful and this stress can lead to anxiety, depression, and other physical and behavioral problems. It’s important to take care of financial stress before it takes a toll on you and your family.

What Causes Financial Stress

Certain situations and circumstances can shake up finances and can lead to a major change in our finances and thus financial stress.

For example, finances may be affected by a job loss or maybe a bad year of sales if you work on a commission. Other major changes include a new baby, separation, divorce, or the death of a family member.

However, financial stress can affect a family at any time and therefore, you must be able to recognize and manage it.

Learn to Recognize

How do you recognize financial stress? You have to learn the signs and signals. Your true sources of stress are not always obvious, and it’s all too easy to overlook your stress-inducing thoughts, feelings, and behaviors.

For example, you may know that you’re constantly worried about being able to pay bills on time. However, maybe it’s your lack of organization, rather than not having the money to pay the bills when they are due, that leads to stress. Hence the importance to sit down and work with your money and bills consistently.

Some signs of financial stress include:

•Frequent worry or arguments about money

•Spending more than you make and using credit cards to make everyday purchases

•Only making minimum payments or making payments late

•Feeling overwhelmed by debt

If you are experiencing any of these, it could mean that you are experiencing financial stress and it is time to start managing that stress.

Manage Financial Stress

Managing financial stress begins with identifying the sources of stress in your life. This isn’t as easy as it sounds.

The ultimate goal is a balanced life, with time for family and work, relationships, relaxation, and fun – plus the resilience to hold up under pressure and meet challenges head-on.

Talk about the situation and explain to family and children how things may and how they can help turn things around. Keep up routines and keep life as normal as possible. So, as a family, eat together and do other things together whenever possible. Focus on the positive and know that your situation is temporary, and you can make it better.

When stress is getting you down, take a moment to reflect on all the things you appreciate in your life, including your positive qualities and gifts. This simple strategy of greatfulness can help you keep things in perspective.

Keep in mind that your children learn how to cope with stress by watching you.

Create a household spending plan or budget. This is the first step toward making it better and regaining control of your finances. Track your expenses and know where every dollar is going. In tracking expenses, you will begin to see ways to reduce expenses and save money.

If your financial situation is stressing you out, recognize the causes of stress and begin to manage that stress. Take charge of your finances and take charge of the stress.

Don’t Resist the Change

Research has shown that when people are trying to change destructive or negative behaviors, only 20 percent of us are in a ready or action phase to change this behavior. The other 80 percent are really not interested in changing at all and are in fact various stages of ambivalence toward the bad behavior.

We resist a lot of things. We resist significant others, we resist those more knowledgeable, we resist authority, and we resist change. Resistance is a part of life; it’s in our DNA and can be extremely dangerous. Resistance is an automatic response to feeling coaxed or to misunderstanding. It is, misunderstanding or lack of clear, effective communication that, in my opinion, started every conflict that has ever been. And so, it goes with managing our finances as well.

Research has shown that when people are trying to change destructive or negative behaviors, only 20 percent of us are in a ready or action phase to change this behavior.

The other 80 percent are really not interested in changing at all and are in fact various stages of ambivalence toward the bad behavior.

One of my favorite quotes from Mahatma Gandhi is, “You must be the change you want to see in the world.”

I like it because it can be used and adapted to many situations and circumstances. If you want to make a change in your financial life, you must change your financial behavior or how you handle money. And to do that, you need to think differently.

The following tips will help you realize the change you want to see in your finances and help you improve your financial behavior.

See that Change is Needed

You are the one, you are the person that will need to make the decision to change. No one can make that decision for you. And to make a change you must first see a need for change. Until you see a real tangible need for change or realize the need for change, no change will take place.

You may not see a pressing need for change at the current time but maybe a family member or friend does.

Ask them if they feel like a certain spending pattern needs to adjust.

If enough family or friends think that you overspend when you go shopping, you probably do and a change in your spending habits is needed. Doing this, can help you see behavior that you may not see, or not see as such a problem.

Develop and Implement Plan of Action

Once you decide to change you need a plan to make the adjustments needed. Your plan should map out steps that you will take to change and possible barriers to finishing the plan.

Additionally, you need to develop strategies for combating the barriers to plan completion. For example, maybe you have a problem when you go shopping that you spend more than you should. This could be a barrier to your plan for changing your overspending habits not coming to completion. Therefore, to combat this barrier, you set a spending limit and take that amount of money with you when you go shopping so that you will not go over the limit.

Maybe you make a list beforehand and take it with you as a tool to combat overspending.

Review and Revise Plan

Plans are just that, plans, and almost meant for change. Review your plans periodically to see if you are working with your plan and it is working with you. If your plan seems to be working…great! No need for adjustments, keep doing what you are doing.

However, if the plan does not seem to be working, it’s time to make a change. Try going back to the problem that caused you to change in the first place.

Are you seeing the problem correctly?

Next, revise the plan based on how you see the change that is needed now.

You can change destructive or bad behaviors. You must want to change the behavior first. Then develop a plan and review the plan every week or so. Revise the plan when it is not working for you.

You Need an Emergency Fund

This is especially during this time of the COVID-19 pandemic. You never really know what happened. Either they lost a job due to COVID-19, or something else dealing with COVID-19 like a parent or close family member getting sick. Maybe they were not living within their means or got extended with bills, and just could not keep up.

As I sit here this morning, a car is being reposed right outside my window. Wow. It’s a nice newer jeep compass, black, with nice tires.

Boy, that happen quick.

I have had several cars reposed and I have never seen it happen, but it’s not a good feeling when it does.

This is especially true during this time of the COVID-19 pandemic. You never really know what happened. Either they lost a job due to COVID-19, or something else dealing with COVID-19 like a parent or close family member getting sick. Maybe they were not living within their means or got extended with bills, and just could not keep up.

This is why working from a spending plan and planning to spend our money is so important. A spending plan will help you keep spending in check and help us avoid negative experiences with money like repossessions.

Whatever the case, when this happened to me I did not have an emergency fund that I could turn to and most people don’t.

An emergency fund or contingency fund, what I like to call it, is just what the name implies, it’s a pool of money that is used for emergencies. A fully–funded emergency fund could equal whatever you wanted it to be, but most would suggest an emergency fund of 3 to 6 months of living expenses.

If you do not have an emergency fund or contingency fund, start today, start where you are, and start building yours.

If you do not have any financial goals, make it your first financial goal…a fully-funded emergency fund, and then save toward the goal.

Did you know if you saved $83 a month in 12 months, you would have $1,000 saved in your emergency fund.

Share your thoughts, subscribe to the GoldenRules Blog, and learn how to create a winning spending plan for you and your family. Share and like this post.

Sticking to a Spending Plan

So, you’ve set a spending plan or budget for your family. You have created this thing to help you plan to spend your money, now what? You are excited and feeling good because you are being a good steward of what GOD has given you.
At the same time, apprehensive because this spending plan/budget thing has never worked for me before. It’s just hard to follow.

So, you’ve set a spending plan or budget for your family. You have created this thing to help you plan to spend your money, now what? You are excited and feeling good because you are being a good steward of what GOD has given you.

At the same time, apprehensive because this spending plan/budget thing has never worked for me before. It’s just hard to follow.

So, how do you stick to that spending plan that you meticulously crafted and are so proud of? After all, for most of us, sticking to a spending plan can be the scariest part of managing money better.

Sticking To a Spending Plan is a Mind Set

Creating and working with a spending plan is not a one-time and done thing its an ongoing process. You have to work your money over and over again. At regular intervals sit down with your spending plan and see where you are and where you need to make changes

What adjustments do you need to make? Are you sticking to your spending plan? Do you need to cut here or cut there?

Developing the right mindset for building wealth requires practice, as well as tenacity. Managing money well stems from a well-developed set of mental processes and you get a well-developed mental process with consistency.

Here are a few ideas to help you stay on course.

First, refer to the receipts and records of your spending that you are now keeping. Compare them to your budget or spending plan. Do this weekly or even daily, to start with. I suggest that you set distinct times to work your budget and money.

Friday evenings, Saturday mornings, or Sunday afternoon, after church are good times (If you have young kids though, they probably wake you up on Saturdays).

If you are within your budget, you are doing well and do not change a thing. If you are not within your budget, make the needed corrections and keep monitoring you’re spending. Keep a check on your spending and your financial situation at the top of your mind. This can help to curb your desire to spend, spend, spend, and ensures you know how much you actually have to spend.

Make it a Family Affair

Include the whole family in the budget. Teach them that the family pack saves money or that saving a dollar this week means having extra money for fun stuff later. Have children go shopping with you and point out what saves you money. Try putting savings towards something the whole family can enjoy, such as a fun weekend out of town. Including the whole family in the budget will make it easier to stay on budget and teach good financial habits for the future as well.

Remember your Financial Goals

Remind yourself frequently of your financial goals. Paying off a big debt, retiring early, or the emergency fund, are financial goals that can keep you on budget. Keep your goals in front of you. Post them on your mirror in the bathroom, your car dashboard, and your purse or wallet. Pull them out and look at them when you are feeling weak.

Stick to your Lists

Make a list before you go shopping and stick to the list. Take the list with you and only buy what is on the list!

It does not matter if it is Wal Mart or Home Depot…stay on the list!

Additionally, do not go shopping hungry. When shopping online look for coupons and comparison shop for the best deals. Talk yourself out of purchases and do not spend money you do not have. Give yourself some time to consider and rationalize before buying, and if you decide later that you need it, go get it.

Be Flexible

Remember that life is unpredictable, and things happen that are out of our control. When, you make a budget, try to allow some extra money for variable expenses. Be gentle with yourself if you go over your budget, it can be hard to get back on track if you let yourself get too frustrated over a mistake or two.

Following these tips can help you stick to your budget, and you can feel good about keeping your finances under control. Make sure you update your budget regularly and prioritize your spending and know what is important enough to be worth your hard-earned money.

What are some tips that you use to stick to your spending plan? Share your thoughts and subscribe to my blog. I would love to hear from you.