The impact of stress on mental and physical health is widely acknowledged. Yet, most people cannot completely avoid being stressed. Financial obligation is a common source of stress for many people.
Imminent recession, increasing debts, seemingly untamable inflation and rising rents without a corresponding rise in earnings worsen the situation for many. Financial stress is a major cause of suicide, as developing economies account for 77% of suicide globally.
Therefore, being able to manage financial stress is very important in a post-pandemic world. In this article, you will learn 6 strategies that will help you to tackle financial stress.
What is financial stress?
Financial stress is the lack of capability to handle financial responsibilities conveniently. A recent survey by Thriving Wallet shows that financial obligations impact the stress level of 90% of Americans.
How to tackle financial stress
1. Prioritise
If you are experiencing financial stress, the logical conclusion is that you do not have all it takes to meet your needs. Hence, it is expedient to prioritise. Allocate your limited financial resources to essential needs, starting with the most urgent and important.
2. Save for essential bills and emergency
Learn to save for essential bills. From your earnings, earmark some percentage for important bills such as housing, feeding and electricity. Save monthly for annual bills.
It is equally important that you save for unforeseen circumstances. Few people were financially prepared for calamities like the Covid-19 pandemic. Sadly, such unexpected catastrophes – job loss, accidents, acute illness, natural disasters, conflicts – do occur.
3. Monitor your spending
Keep a daily record of how you spend. At the end of each week and month, go through it. Identify areas where you spent unnecessarily. Eliminate them subsequently. Gradually, your spending habits will improve.
4. Look for ways to earn more
As much as you can, try to have alternative sources of income. If you are an entrepreneur, you may consider delving into allied businesses. As an employee, you may render freelance services with your current skills or acquire additional skills.
5. Keep a budget
Keeping a budget is a good way to control your spending. Have budgets for your expenses and projects. More importantly, stick to the budget as much as possible. Whenever you can, avoid the urge to spend on items outside the budget.
6. Overcome impulsive and compulsive spending
Impulsive spending is the inclination to spend on things you did not plan to spend on while compulsive spending is the urge to spend on things you do not actually need. Together, these two habits drain your savings or prevent you from having one. They are major causes of financial stress for many spenders.
Final thoughts
Financial stress is capable of exerting a great impact on emotional, mental and physical health. As one of the major causes of suicide, being able to manage financial stress is important in a post-pandemic world.
Also read:
Financial Stress and Its Impact on Students
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