Taming Your Financial Anxiety
In recent years, many individuals have experienced heightened financial anxiety as a result of various global events, ranging from economic uncertainty and inflation to geopolitical tensions and pandemic-related disruptions. The fear of job loss, rising living costs, and potential recessions have left households feeling vulnerable and overwhelmed. Moreover, the fluctuating stock market, coupled with increased interest rates on loans and mortgages, has added further strain to people’s financial stability. As savings dwindled during the pandemic and government assistance programs began to taper off, many are not only grappling with immediate expenses but also facing the prospect of long-term economic insecurity.
Additionally, the pervasive influence of social media and news coverage amplifies these anxieties, as individuals constantly compare their financial situations to those of others. This relentless pressure can lead to feelings of inadequacy and hopelessness, especially for younger generations who are entering a competitive job market and dealing with substantial student debt.
As individuals navigate these challenges, the combination of financial stressors and societal expectations fosters a profound sense of unease about the future, underscoring the importance of financial literacy, mental health support, and community resilience in overcoming these turbulent times.
Addressing Financial Anxiety: A Holistic Approach
Coping with financial anxiety requires a proactive and multifaceted approach that fosters both emotional resilience and practical stability.
One of the first steps individuals can take is to create a detailed budget that outlines their income, essential expenses, and financial goals. This process not only provides clarity on where money is going but also highlights areas where cuts can be made.
By gaining a clearer understanding of their financial situation, individuals can reduce their uncertainty and feel more empowered to make informed decisions. Utilizing financial tools and apps can facilitate this process, offering insights into spending habits and helping track progress over time.
In addition to practical budgeting, building an emergency fund can serve as a crucial buffer against unexpected expenses, thereby alleviating some financial stress. Financial experts often recommend saving at least three to six months' worth of living expenses to provide a safety net during difficult times. Even small, consistent contributions to a savings account can have a significant impact over time and foster a sense of security. For those facing overwhelming debt, exploring options such as debt consolidation or speaking with a financial advisor may provide the guidance needed to develop a manageable repayment strategy.
Addressing the emotional aspects of financial anxiety is equally important.
Mindfulness practices, such as meditation, deep breathing exercises, or journaling, can help individuals process their feelings and reduce stress. Connecting with supportive friends and family members to discuss financial concerns can also alleviate isolation and provide validation. Furthermore, seeking professional help, whether through financial counseling or therapy, can offer tailored strategies to cope with anxiety and develop a healthier mindset towards finances.
By combining practical financial management with emotional and mental wellness techniques, individuals can better navigate the complexities of financial anxiety and regain a sense of control over their financial futures.
Managing Your Financial Anxiety
Unlike stress, which can sometimes act as a positive motivator to push through a challenging situation, anxiety — financial or otherwise — can feel paralyzing.
Left unchecked, it can have a serious impact on your ability to eat, sleep, focus and engage in healthy relationships, creating a dangerous loop: The more you experience anxiety around your finances, the harder it becomes to manage your mental health … and the more your mental health is taxed, the harder it becomes to manage your finances.
Worrying about money is normal, even in the best of economic times. From early on, we’re taught to believe that having a certain amount of money will make us feel safe. Scarcity can trigger insecurity — and inferiority when used as a basis for comparison to others. These associations can create anxiety, regardless of the economic climate, leading to the adoption of unhealthy coping mechanisms (e.g., overeating, smoking, substance abuse) and feelings of hopelessness and depression.
The following strategies can help you gain control over your financial anxiety, allowing you to take practical steps to manage and improve your financial position.
Stay Grounded in the Present
Recognize what you can and can’t control right now. Accept that life might look and feel very different for a while. Take stock of your resources and consider ways to make the most of them. Shift your focus away from what’s missing; focus on what’s available to you.
It’s easy to get caught up in the “what-if’s.” But because “what if’s” are usually negative, they cause undue stress and anxiety. Nobody has a crystal ball that can predict the future!
Worrying about all the things that could happen is an unproductive use of your mental energy — and it doesn’t stop those things from happening. Focus on “what is,” and, from there, use your energy to problem-solve.
Explore Tactical Solutions
Having the right mindset in place will help you objectively explore steps you can take to improve your financial situation. Consult experts you know and trust for advice. Talk with a financial advisor, accountant, career coach, real estate broker and other specialists who can help you make prudent decisions based on your individual circumstances.
As you explore your options, avoid taking unnecessary risks — with your health, physical safety or money. Avoid putting yourself out on a financial limb if you can’t comfortably afford it right now. Any actions you can take to provide a sense of security will help temper your anxiety.
Prioritize Your Mental Health
Because the link between financial distress and poor mental health has been long established, it’s particularly important to engage in activities that support your overall wellbeing when you’re wrestling with financial anxiety:
Even (or especially) if you’re not feeling motivated, incorporate some sort of physical movement into your day. Practice good sleep hygiene. Eat healthy foods.
Try an app like Headspace, Calm or Insight Timer to incorporate meditation into your daily routine. Many studies have substantiated the long-term benefits of meditation in treating anxiety disorders.
Try to become aware of what tends to spark your anxiety. Overexposure to the news and social media can become overwhelming; recognize the fine line between being informed (which can be calming) and being overwhelmed.
Stay connected with friends and extended family. It doesn’t have to be in person! Take advantage of technology (e.g., Zoom, Skype or FaceTime) to stay in touch with people you care about — and who care about you.
Reach out for professional support. If you’re already in therapy, keep your appointments — now is not the time to skip therapy! Most counselors, therapists and psychiatrists provide virtual therapy, which may afford more convenience in scheduling your appointments.
Know That You’re Not Alone
Challenges can bring out the best in people. Reflect on the strengths you’ve drawn upon to get you through past hardships. How can you rely on those strengths to manage your financial anxiety?
Sometimes, knowing that you’re not alone in experiencing financial anxiety can be comforting. Unfortunately, we’ve been culturally conditioned to believe that finances are a taboo topic of conversation; thus, unlike other personal challenges, people tend to keep their financial struggles to themselves. This can contribute to feelings of isolation and shame—and assumptions that you’re experiencing greater financial hardships than others.
In addition to one-on-one counseling or therapy, many organizations and private practitioners offer safe, supportive groups designed to help participants learn in the company of others facing similar challenges. Listening to and lending your support to others can be comforting, cathartic and empowering!
You don’t have to go this alone.
If you’re interested in learning more about individual psychotherapy, psychoanalysis or adolescent psychotherapy, please contact us by submitting this form, or by phone at 847-729-3034. We’ll be happy to answer any questions you might have.
