The web of bills, debts, and economic uncertainties is an unfortunate reality that affects most of us. With the average American debt exceeding $103,000 per person in 2024, it’s a battle that many of us are facing.
The term “financial anxiety” might sound like a buzzword, but for many, it’s a palpable reality that can cast a shadow over even the sunniest days.
We know how serious this situation is, and today, we will guide you on not only coping with, but also overcoming the financial stressors that jeopardize our peace of mind and overcoming financial anxiety.
What is Financial Anxiety?
Financial anxiety is a psychological and emotional response to stressors associated with one’s financial situation.
This pervasive issue impacts individuals irrespective of age. A staggering 77% of Americans experience anxiety related to their financial situation, with 73% ranking finances as their primary source of stress (CNBC).
Additionally, 52% of adults in the United States said money has a negative impact on their mental health (Bankrate), showcasing the importance of maintaining good financial health to carry on with our daily lives.
It is worth noting that this form of anxiety disorder is not solely tied to the amount of money a person has, but is often rooted in a combination of financial factors, individual perceptions, and the uncertainties associated with managing personal finances.
Financial Anxiety Symptoms
While the symptoms of anxiety can vary from person to person, there are three key warning signs to be aware of if you are experiencing difficulties with money management:
- Persistent Feeling of Worry About Finances: One of the primary symptoms of financial anxiety is a pervasive and ongoing concern about money matters. People experiencing financial anxiety may find themselves preoccupied with thoughts about bills, debts, and financial obligations, even when engaging in unrelated activities. This persistent worry can lead to heightened stress levels and difficulty focusing on other aspects of life.
- Physical Symptoms of Stress: Financial anxiety can manifest in physical health, with individuals experiencing symptoms such as headaches, muscle tension, digestive issues, and even sleep disturbances.
- Avoidance Behavior and Procrastination: Financial anxiety often leads to avoidance behavior and procrastination when it comes to tackling financial tasks. People may delay opening bills, avoid checking bank statements, or put off making important financial decisions due to the fear or discomfort associated with facing their financial issues.
3 Common Reasons People Have Financial Anxiety
Financial stress and anxiety (learn about the differences between anxiety and stress here) arise from a wide variety of reasons, ranging from the cost of living to a lack of financial education, and there is always a monetary component linked to financial anxiety.
Debt Overload
The burden of debt, whether it’s from student loans, credit cards, or mortgages, can be a major source of financial anxiety. The constant pressure to meet monthly payments and the looming specter of interest can create a perpetual cycle of worry.
Income Insecurity
Uncertainty about your financial future, stemming from irregular income, job instability, or a fear of unexpected expenses, can definitely contribute to financial anxiety. The lack of a stable financial foundation can make planning, covering monthly expenses, and budgeting seem like a big challenge.
Lack of Emergency Savings
A sudden medical expense, car repair, or other unexpected financial setback can throw even the most careful planners off balance. Without a sufficient emergency fund, people may find themselves in a constant state of unease, fearing the financial repercussions of unforeseen circumstances.
How to Handle Financial Anxiety: 5 Tips
While overcoming financial anxiety can be a formidable challenge, there are proven ways and tips that you can follow to cope with it and eventually overcome it.
1. Get an Anxiety App
Getting an anxiety app like Rootd is straightforward – simply download it from the App Store or Google Play Store to access an immediate stress and anxiety reliever and companion.
Rootd can assist you in performing breathing exercises, employing anxiety management techniques, and providing relief as needed. Additionally, it acts as your guide to overcoming financial problems and discovering the best personalized path to alleviate money-related worries.
2. Create a Realistic Budget
Establishing a clear and realistic budget is a fundamental step in managing financial anxiety.
Track your income, expenses, and savings goals to gain a comprehensive understanding of your financial situation. A well-organized budget can help you prioritize spending and current bills, identify areas for potential savings, and provide a sense of control over your finances.
3. Build an Emergency Fund
A financial safety net can significantly alleviate anxiety related to unexpected expenses, especially when 49% of Americans cannot afford a $1,000 emergency (LendingTree). Strive to build an emergency fund that covers three to six months’ worth of living expenses.
Knowing that you have a financial cushion can provide a sense of security and reduce the stress associated with unforeseen financial challenges.
4. Practice Self-Care and Stress Management
Recognize the impact of financial anxiety on your overall well-being, and implement self-care strategies.
Try to participate in activities that bring you joy and relaxation, such as exercise, meditation, or spending time with loved ones. Managing stress through self-care not only improves your mental and emotional state but also enhances your ability to make sound financial decisions.
5. Seek Professional Advice
Consider consulting with a financial advisor to gain expert insights into your financial situation. Professionals, including financial counselors and therapists, can provide guidance on budgeting, debt management, and investment strategies tailored to your specific needs.
Having a knowledgeable partner in your financial journey can help demystify complex issues and empower you to make informed decisions.
Wrapping Up: Dealing with Anxiety, Stress and Financial Worries
Money matters, and it affects our quality of life, mental health, and emotional stability (more than most of us would like to admit).
Learning the reasons behind your financial problems is the first step to finding tailored solutions to your needs. Investing in your financial education, planning ahead, and seeking help from an anxiety app are key to overcoming the financial challenges we all face in our daily lives.Additionally, consider seeking help from a professional who can understand your case better than anyone else and provide you with the tools to empower your fight against financial anxiety.
The post Financial Anxiety: What’s That & How To Deal With It? appeared first on Rootd.