How to Deal with Financial Anxiety
Your financial situation is unlikely to kill you. Your financial stress, on the other hand, can kill you. As a result, it is critical to managing it effectively.
Here are five suggestions to help you deal with financial stress.
You are not alone
When we feel isolated, our stress levels rise. Knowing you’re not alone if you’re worried about money is important. According to the American Psychological Association, money problems are a significant source of stress in the lives of 7 out of 10 adults.
Take a time-out
When we are stressed, our minds can spiral out of control. It is critical to take a break and clear your mind. Including some activities that induce a relaxation response is beneficial to your mental health.
This could include going for a walk, listening to music, reading a book, or taking some deep breaths. Breathing exercises can help lower your heart rate, blood pressure, and stress hormones, and help you think more clearly.
Avoid negative thinking
“I owe money on my credit cards.” I’ve failed. “I’m good at everything.”
“I was laid off. I’m going to be impoverished. Forever.”
When our finances feel out of control, it’s easy to fall prey to catastrophic thinking, in which we ruminate irrationally about what might happen and who we are.
Exaggerated thoughts result in stressful emotions. To reduce the negative impact of irrational fears, keep things in perspective. This is where the following tip can help.
Consider the worst-case scenario
Why would I encourage you to consider the worst-case scenario after just advising you to avoid catastrophic thinking? While your financial situation is unlikely to endanger your life, financial stress can be.
This exercise forces you to confront your fears head-on. Examining the worst-case scenario has the paradoxical effect of lowering your anxiety. It is a type of exposure therapy that can assist you in keeping things in perspective.
Take your time thinking about it. What would happen if you lost your job, for example? What would happen if you had to live with family or friends?
Continue following the chain of worst-case scenarios. Most people find that fleshing out the details helps them realize that, while uncomfortable and possibly inconvenient, the situation is not life-threatening and that they can eventually get back on track.
When we lack confidence in our ability to face a challenge, our anxiety skyrockets. This is common in personal finance, where many people lack basic financial literacy.
If your financial anxiety causes you significant distress or makes it difficult for you to manage your life, you may benefit from professional assistance.
Consider working with a mental health and/or financial planning professional to help you deal with your anxiety and move forward with your financial goals.