If you get a stomach ache every time you check your bank account, or often find yourself tempted to do some online shopping to lift your spirits, you could be suffering from money anxiety.
Financial anxiety is much more common than you might think. In fact, 87% of us suffer from some form of money stress, according to the American Psychological Association. And contrary to popular belief, it doesn’t always arise from a lack of resources. Sometimes, even high earners find themselves burdened with financial worry.
While dealing with fear, stress, and anxiety can be common, it’s still unpleasant to experience. The good news is that there are tangible things we can do to lessen these worries.
The best approach to crushing money anxiety is twofold: We need to work on both changing our mindset, and taking actionable steps towards getting our money in order.
What is money anxiety?
Money anxiety is the feeling of stress, worry, and fear surrounding one’s financial situation or the topic of finances. It can stem from a variety of factors such as debt, job insecurity, lack of savings, or even financial FOMO. However, it can also persist even when you’re crushing your money goals.
When left unchecked, it can lead to negative impacts on your mental and physical health. But don’t worry, because in this post we’re going to give you some practical tips to lessen the effects of money anxiety.
Signs You May Be Dealing With Money Anxiety:
Here are some symptoms and activities that might reveal if you’re experiencing money anxiety…
Constantly checking the news or your financial accounts: If you tend to check and recheck your investment portfolios, credit card balances, or bank accounts, and compulsively monitor financial news, you could be suffering from money anxiety.
Feeling depressed or hopeless thinking about money: Sometimes, financial anxiety can cause us to feel completely demoralized when we think about taking steps towards securing our financial future.
Avoidance: Sometimes money anxiety can manifest as bills stacking up on the counter, or avoiding looking at your bank accounts because you’re afraid to confront your spending.
Feeling too emotional when you think about frugality: If trying to be frugal dredges up a ton of negative emotions, or makes you feel too restricted, it could be time to reframe your relationship with money.
Letting others take the reins: It’s never a good idea to “check out” and let a partner or financial advisor have complete control over your money.
Relying on spending to lift your spirits: It’s no secret that spending money can give us an emotional boost. Studies have found that shopping stimulates the pleasure centers in our brains. However, when left unchecked, emotional spending can wreak havoc on your finances.
Ultra Frugality: A complete fear of spending, or going the ultra frugal path can be another manifestation of financial anxiety. This way of life can have a negative impact on your health and relationships.
Overworking: If you feel like you need to constantly work to keep your head above water, it could be time to confront your money anxieties, or to make changes to give yourself more margin.
Ways To Address Money Anxiety
If any of those symptoms resonated with you, you may be realizing the impact that financial anxiety has had on your life. Luckily, there are many ways you can work on your relationship with money to lessen your financial stress.
1. Realize it’s normal
Anxiety is something we all deal with at different points in our lives. While it isn’t fun, it’s definitely normal. There’s nothing inherently wrong with you for feeling the way you are feeling. Realizing that you’re not alone can help you to feel more ready to tackle those difficult emotions.
2. Take care of yourself
Everyone who struggles with anxiety hates getting this advice, but it truly does make a difference. Taking care of your physical health can almost always lead to a positive impact on your mental health.
Exercise is one of the best ways to manage your anxiety, financial or otherwise. According to Harvard Medical School, physical activity can change your brain chemistry to decrease anxiety. Exercising helps relax muscle tension, making you feel more at ease. Getting 7-8 hours of sleep and making sure to eat healthy can also greatly impact your mental health!
3. Let yourself feel your feelings
If you’re dealing with money anxiety, it’s important to not bottle up your emotions. Holding them in can lead to those feelings to come out in less healthy ways down the line. Talk to your friends and family about how you’re feeling. You may be surprised to find that many of them are dealing with similar emotions!
4. Accept reality
The only way to move forward is to accept your situation as it is right now, and to accept yourself for who you are today. If you’re in debt, no amount of beating yourself up about it is going to reduce that balance. If you’re not making enough, no amount of sitting around and feeling bad about yourself will fatten your paycheck. So accept yourself where you are in order to make room for growth.
Another important thing to remember – your net worth is not your personal worth! There is so much more that makes you YOU. The way you handle money is just one aspect of all the deep and complex things that make you who you are.
Related: Debt snowball vs. debt avalanche payoff plans
5. Focus on what you CAN control
You may not have control over the economy, but you have control over things like your budget, your retirement contributions, and your debt payoff plan.
Focus on the things that you can do to make a positive difference in your financial life. Taking care of these tasks can help you to feel more like you’re the one steering the boat of your life, and can give you a sense of accomplishment and pride!
6. Reframe your situation and serve others
Getting our hands dirty by helping others in our community can help us to realize the good things that we already have! Serving others gives us a deeper sense of purpose. It sounds silly, but sometimes when I’m feeling anxious all I have to do is go out and “touch some grass.” Connecting with my environment and working to build a stronger community always makes me feel a little more gratitude.
7. Be mindful of news consumption
It’s no secret that some of the news we consume is spun negatively, or sometimes sensationalized. If checking the news sends you spiraling, try limiting your news intake to once a week, or subscribe to a weekly recap newsletter. You can even stop checking it altogether for a little while if it’s having a negative effect on your mental health and finances.
While it’s a good idea to stay informed, it shouldn’t be to the detriment of your wellbeing. Plus, there’s not much we can do to change the macro-reality of our nation or world. Lessening your news intake will almost certainly decrease your money anxiety.
8. Set aside dedicated time to work on money issues
If you find yourself constantly thinking about money, it could be helpful to create a weekly schedule where you set aside some time to work on any pressing money issues. Baking it into your weekly routine can help you to alleviate some stress. It helps you think less about money throughout the week.
When you feel money anxiety coming on, you can remind yourself that there’s a time and place to figure out how to address your money concerns right around the corner, just a few days away.
9. Stop comparing yourself to others
Another way you can help to put your mind at ease is to stop comparing yourself to other people. If doom scrolling on social media leaves you feeling hopeless, unfollow accounts that make you feel this way, or delete the app from your phone. Remember that social media is a “highlights reel.” You only see people on their best days. We all know this intuitively but our brain tends to play tricks on us as we scroll.
Remember that we all begin our financial journey at different starting lines. You’ll never see someone’s entire story. There could be other factors at play, like credit card debt which is funding that lavish lifestyle. The truth is, you’ll never really know what’s going on behind the scenes, so it’s best to focus on your own situation!
10. Take small, actionable steps
Sometimes, having big overarching goals without a plan of action can leave us feeling overwhelmed with money anxiety. Try breaking down bigger goals into the smallest possible steps and go from there.
For example, if you’re hoping to pay off your student loans, calculate how much you would have to pay each month to finish paying it off by your desired date. Go a step further to break it down to how much you need to put towards your payment on a daily basis. Breaking your goal down into bite-sized pieces makes it feel a whole lot less intimidating.
Make sure to celebrate small victories along the way too. And focus on the small, day to day things you can do to make that goal a reality. A bunch of small steps will lead to some giant leaps in your financial life over time!
Related: Should You Buy It?
11. Get an emergency fund
One reason why people often feel money anxiety is because they know that one emergency could completely upend their finances. The best way to combat this type of stress is by creating an emergency fund! If you know you’re covered in the case of an emergency, it will provide you with so much more peace of mind!
Economists have found that seeking to amass $2,467 in your savings account will protect you from the vast majority of money emergencies that could come your way. If you want to save that much up in a single calendar year, focus on saving $7 a day. See, doesn’t that feel more doable!?
Pro tip: Once you’ve created an e-fund, don’t touch it! With money just sitting around it can be tempting to spend it, so definitely familiarize yourself with ways to stop dipping into your savings!
12. Consider speaking with a mental health professional
Sometimes, you can take all of these steps and still find yourself struggling with financial anxiety. In that case, it could be time to consult a mental health professional. The National Foundation for Credit Counseling is a non-profit which can provide low cost credit counseling.
If you’re looking to connect with a mental health professional, you can try connecting with one using the Mental Health America Affiliate Resource Center.
The Bottom Line:
Some degree of anxiety is normal in everyday life. But it doesn’t mean you have to feel anxious about money all the time. We hope these tips help you to build a better relationship with money so you can enjoy chasing down your financial goals!
If you’re looking for more help combating money anxiety, be sure to check out Episode 631: Solutions for Money Anxiety With Financial Therapist, Lindsay Bryan-Podvin.
Beer tasting notes:
During this episode we enjoyed a Sour Opal by Firestone Walker- thanks to our friend Josh for donating it to the show! And as we ramp up the podcast with an additional Friday episode every week, we could really use your help to spread the word- let friends and family know about How to Money! Hit the share button, subscribe if you’re not already a regular, and give us a quick review in Apple Podcasts or wherever you get your podcasts. Help us to spread the word to get more people doing smart things with their money in these difficult times!
Best friends out!
Of all the causes of anxiety I think money anxiety is the easiest one to eliminate. If you don’t do things like racking up enormous student debt, car loan debt and overspending on housing then you can be debt free and building investments rapidly as a young adult. You can’t eliminate all the issues with relationships, health, or crime, but you can absolutely attain financial freedom and leave money worries behind you.