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. 

Tips for an Effective Spending Plan

Be Ready to Make Adjustments – Keep in mind that a spending plan is an estimate or plan of how you will spend or expend your money and plans change. 

Creating a spending plan or budget and then sticking to it can be quite difficult.  Even if it works on paper, for many it does not work well in practice and many people try and fail at budgeting.

And 38% of the population does not even try to create a spending plan. 

You can create a spending plan that works for you and your family.  Below are a few tips to help you create a better more effective spending plan.

Time is your Friend – Whenever you are working with a spending plan, you can choose to look at it daily, weekly, monthly, or within some other time constraint.  I recommend weekly, or monthly depending on when you get paid.

Reserve a specific time to sit down with your spending plan before you get paid and stick to that time.

For example, Sunday after church or Wednesday after work.

Use this time to get very familiar with your spending plan and expenses, and record when money goes out and when money comes in.  This time you spend working your money will get shorter the more you work it, but the key is to be consistent.

Set realistic spending limits – One reason why budgets fail is that there is not a realistic spending limit.  For example, you get ready to budget and plan to spend $400 this month on groceries.  Three weeks into the month, you realize you spent $420 with another week to go.

Some people will get frustrated and quit after they realize they went over their plan limit. 

It’s not the budget that is at fault it’s your unrealistic spending limit.  If you spent $500 on groceries last month, you are probably going to spend around $500 this month.  Be realistic with the limits you put on your spending.

Be Ready to Make Adjustments – Keep in mind that a spending plan is an estimate or plan of how you will spend or expend your money and plans change.

Be open and flexible to changes in the plan.  

When circumstances change such as when you get married or have a child or change jobs, your spending plan is going to need to change.  New spending categories and saving for college for the kids or retirement is going to possibly require changes to the plan.

What are your tips for an effective spending plan?  How do you manage your spending plan?  Subscribe to the GoldenRules Blog and learn how to create a winning spending plan for you and your family.

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