7 Tips for Dealing with Financial Stress

Financial stress is an almost universal experience. But the financial strain on many people is especially pronounced right now due to the economic fallout of the COVID-19 crisis. If left unchecked, this money stress can damage both your financial and mental health. 

“Financial stress becomes problematic when it’s impacting a person’s ability to make wise financial choices,” says Lindsay Bryan-Podvin, LMSW, a financial therapist at Mind Money Balance. “If you are so stressed you’re paralyzed to the point of not being able to take financial action, then financial stress is an issue.”

You don’t have to be stuck in inaction and at the mercy of money anxiety, however. Here are some steps you can take to deal with a stressful money situation to regain some financial and emotional security.

1. Gauge your response to financial stress

“I see two common behaviors when financial stress happens: perfectionism and procrastination,” Bryan-Podvin says. “We don’t like feeling stressed, and engaging in perfectionism or procrastination, we can temporarily avoid that feeling of discomfort.” If you reflect on whether you’re more prone to procrastination or perfectionism, that can point you to more effective strategies to move past them.

Perfectionism can look like constantly checking your bank account, over-researching financial options, or feeling like you have to have all the answers right away. If this is your tendency, Bryan-Podvin recommends using logic. Weigh whether you actually need more information or it’s time to act on your best guess.

Procrastination can look like the opposite: not checking your financial accounts, putting off money tasks, and feeling helpless or lost at where to start. In these cases, it’s about finding ways to ease or deal with the discomfort of managing your money to still get tasks done.

2. Make a money action plan

Financial stress can get especially hard to deal with when you don’t have many answers. “Our stress and anxiety increase when we are uncertain of something,” Bryan-Podvin says. To deal with this, she suggests getting a handle on money matters. “Increasing financial literacy and getting a basic understanding of your finances often helps to dial down financial anxiety.”

This can involve looking into the specific stressful money topic, whether it’s a job loss, student debt, or managing your budget and savings. Research and read about options to get some ideas of solutions and strategies that can help you. You can use these to put together an action plan with the big-impact steps you can take to improve your finances. Planning can do wonders to help you feel more in control and financially secure.

3. Rally your financial resources

Once you have a plan, it’s important to figure out what resources you have available to help execute it and get yourself back on stable financial ground. Start with your own money: from cash in checking and savings, to credit lines you can temporarily tap, or family members or friends you can turn to. Take note of any and all financial options you could turn to if things get rough.

On top of making a plan for your money, look for other help and support. These aren’t always obvious, but government benefits, relief funds, and other forms of aid can help you weather a financial storm. Other top places to search for financial relief include: federal benefits, state and local programs, national and local nonprofits and charities, and local churches. 

For assistance amid the current crisis, check out the Plutus webinar on Coronavirus pandemic resources for those affected by the crisis.

4. Prioritize and tackle one task at a time

With these steps, you can take and an idea of the resources and relief you could claim, it’s time to start prioritizing. So first, identify and prioritize which would have the biggest positive impact on your finances. Once you know where to start, break this bigger focus down into even smaller steps. 

Maybe you’re out of work and know you need to apply for unemployment, for example, but that feels like too much to take on in one sitting. So don’t force yourself to take it all on at once! 

Start small: locating the online unemployment application, reading about the documentation you’ll need, starting to collect those, and so on. As Bryan-Podvin mentions, breaking big financial problems down into small, simple tasks can help you get past initial stress and anxiety to move forward.

5. Manage stress as you go

It’s important to make the money moves you can to keep yourself financially healthy, but don’t throw yourself into fixing your finances at the expense of your mental or emotional state. 

“We have to check in with the way we are thinking and feeling about our money,” Bryan-Podvin says. “If our bodies are sending us signs of financial stress in the form of muscle tension, difficulty breathing, racing heart, headache, or nausea, it’s a sign that we need to regulate our bodies and quiet financial stress before we engage with our money.”

In these moments, step back from the money side of the situation and focus on managing stress. Engage in your go-to de-stressing activities to calm and clear your mind. This could be exercising, doing some breathing exercises, hugging a pet, or calling a loved one who can help you sort things out.

6. Work through emotions around money

As you calm financial stress, this can also be an opportunity to explore the emotions that a financially stressful situation is bringing up. 

“Knowing and working through our emotional responses to financial stress and being able to name the specific emotions attached to the financial stress starts to help reduce the financial stress,” says Ed Coambs, LMFT, a North Carolina financial and couples therapist. By recognizing these underlying emotions and thoughts, you can work through these responses constructively and limit their negative effect on your money.

You can also use your emotions as another tool to tackle financial stress. Offering compassion and toward yourself as you work through your financial situation and stress, too. “Moving towards financial empathy starts to help people move out of anxiety, anger, shame, and avoidance of addressing financial stress,” Coambs suggests.

7. Seek professional support

It’s understandable that you’d have more money stress when facing a financial hardship like unemployment or economic uncertainty. But Coambs advises looking beyond the immediate crisis. “Identify if this is long-term financial stress that has been happening prior to COVID-19 or if this is situational stress,” Coambs advised. 

If you’ve often struggled with money anxiety or have had ongoing financial struggles, you might benefit from seeking professional help. “People do not have to suffer with their financial stress, there is help available,” Coambs adds. Financial therapists can be an excellent resource, as well as couples therapists, financial counselors or financial planners.

Lastly, remember that some level of financial stress is normal and even healthy. “Healthy levels of stress allow us to remain clear-headed and identify a range of options or solutions to the financial issues we are facing,” Coambs says. Work to keep anxieties manageable, then use them to fuel financial improvements and progress.

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