Are you ready to stop worrying about money? Solving your money problems will take some intentionality but you can turn your financial future around and start enjoying your life again when you cut out the money stress.
I know that sounds easier said than done but I am going to share with you my best tips to help you reduce your constant anxiety about money.
The Impact Worrying Has On You
Worrying about money not only affects you but everyone around you. It can cause angst in your relationships and keep you up at night.
Worrying is a Waste of Your Energy
When you are worrying about money (or anything for that matter) you are less productive. You are constantly thinking about your money situation and often forgetting to do things or putting important tasks on the back burner.
Have you ever tried to lay down for bed but your budget and debt are constantly running through your head? You feel helpless in your financial future and it is keeping you up at night.
This isn’t just affecting today – it is also impacting tomorrow because you won’t have a quality night’s sleep.
Worrying Impacts Your Quality of Life
Worry and stress can cause headaches, muscle tension, high blood pressure and so much more. There are steps you can take to end chronic worrying and regain control of your health.
Worry can also impact your relationships with family and friends. Others around you can sense the stress levels you are under and it makes for an unpleasant time together.
You may find yourself becoming more isolated due to your constant worrying about money.
Worrying Can Lead to Behavioral Issues
Ther are many responses to stress. Some people turn to food to cope with their stress, while others may smoke or drink. You may withdraw yourself from social situations like going out with friends or attending family events.
If you find yourself constantly worrying about money I have 8 tips that will help relieve your financial anxiety so you can start living again.
How to Stop Worrying About Money
Are you ready to reduce your money stress and start enjoying your life again? Improving your money mindset will take some time but with these money tips, you’ll be closer to meeting your financial goals and loving your money!
Simplify Your Finances
Simplifying your finances is the first thing you should do when you have constant anxiety about money.
By having a clear plan and vision for your finances you’ll be able to see the bigger picture to make informed decisions moving forward.
Assess Your Money Situation
Start by assessing your finances. To do this you will want to look at your whole financial picture – bank statements, credit card statements, retirement, etc.
This will show you exactly how much money you have and how much money you owe.
You need to know where you are starting so you can begin to form a plan.
If you do not track your net worth this is a great habit to start implementing.
Create A Budget
A budget is a plan for your money and is not meant to be restrictive. It will help you see that bigger picture of your finances so you can stop worrying about money. You’ll know exactly how much you have coming in and where it should be spent.
You want your money working for you so you are not wondering where your money went at the end of the month.
To create a budget you will need a worksheet or a budgeting app to get started. I highly recommend starting with a budget worksheet so you can physically write down your monthly money goals and track your expenses.
You can download my free budget worksheets by entering your name and email address below!
Pay Yourself First
After you have been budgeting for a few months and you have a clear understanding of where your money is going it is time to start paying yourself first.
Paying yourself first can be as simple as setting aside a percentage of your income each month to build your emergency fund or start building your sinking funds.
By paying yourself first you’ll begin to relieve some financial worry by having money in the bank. Even if you have just $1,000 set aside you’ll sleep better at night knowing that you can cover a small emergency if one should arise.
Once you have a handle on your budget it is time to utilize AutoPay. This is one of the best ways to simplify your finances.
You’ll no longer worry about your bills being paid on time because the bill will automatically be drafted for you.
Be sure you are still present with your budget though and continue to track your spending so you can make necessary changes.
There are two ways you can set up AutoPay. You can do this directly through the company, normally there is an AutoPay section within their billing on the website.
Using the Company’s Website
Using the company’s website is my favorite way to set up AutoPay because I know the payment will always be drafted for the amount due on or before the due date.
This is important with credit cards because the due date often fluctuates and you may end up with a late payment otherwise.
Using Your Banks Bill Pay
If you decide to use your bank’s bill pay you will want to ensure that you have enough money being drafted each month to pay the bill. This is especially important for bills like water and electricity that can fluctuate month to month.
With your bank’s bill pay, you’ll also need to watch your due dates for bills that may fluctuate when they are due. I see this most often with credit cards. If you pay just a day late you’ll end up with a late fee which we are trying to avoid at all costs.
Live Below Your Means
Living below your means is another great way to stop worrying about money. You’ll want less and you’ll spend less.
This means you’ll have more money in your pocket and you’ll stop adding to your debt.
By living below your means you only spend what you have budgeted and not a penny more. It is difficult in the beginning but will reduce your money stress and anxiety.
Reduce Your Debt Burden
To stop worrying about debt you need to put a debt reduction plan in place. By creating a plan you will have a clear vision of how you will pay off your debt and the amount of time that it will take to reach your goals.
I highly recommend using the debt snowball to pay off your debts. With the debt snowball, you will begin paying the lowest balance first to give yourself quick wins. This will help your money anxiety because you will have one less debt to pay each month.
If you would like to go for the more mathematical approach to debt reduction, I recommend using the debt avalanche. With this debt repayment method, you’ll pay off the highest interest rate balance first saving you the most money in the long run.
No matter which debt repayment plan you decide to use, this step will help relieve money stress.
Reduce Your Tax Burden
We have all heard the phrase “the less money you owe in taxes the better”.
There are legal ways to reduce your tax burden that can have a dramatic impact on your finances.
You can increase your contributions to your 401k or Roth IRA.
You can make charitable contributions or make wise small business purchases.
If you need more assistance with your tax situation I highly recommend consulting with a Certified Public Accountant. They will walk you through your tax situation and give you tips specific to your circumstances.
Have an Emergency Fund
An emergency fund is a savings account that you have in place to use in case of a large unexpected expense.
- unexpected job loss
- unexpected medical or dental expenses
- car accidents
- natural disasters
- major home repairs
- unexpected tax bill
- last-minute travel (death in family or family illness etc.)
By having an emergency fund in place you’ll reduce your need to worry about money because you have that safety net in place to help you out of a tough situation.
If you do not have any type of savings you should aim to have $1,000 in the bank as soon as possible. This will help you with a smaller emergency as you build your fully-funded emergency fund.
A fully-funded emergency fund should include 3 to 6 months of necessary expenses. It is totally up to you what you feel is a necessary expense.
In an emergency situation like a job loss; you’ll most likely want to cut back on luxuries like cable, eating out, fun money and any other expenses you can live without.
Be Content with What You Have
When you are content with what you have you will no longer want for more. You’ll begin to enjoy your life and do more to take care of yourself.
Being content and happy with your current situation reduces the amount of money anxiety you have because you’ll no longer want to keep up with the Joneses.
It is not an easy transition to be content but once you get to that point you’ll look back and realize how much stress comparison was causing you.
By buying second hand you’ll begin to see a shift in how much money you are spending and the impact you are having on the environment.
Buying used items such as clothes, vehicles, household items, and more, can save you thousands of dollars each year.
Buying new items will not make you any happier and can actually cause you to worry about money more because you may have spent more than you intended.
Cut Out Luxuries
There are so many luxuries we indulge in without even thinking. A luxury is a product or service that is not necessary but is highly desired.
If you are working on your budget and reducing your expenses some luxuries include:
- buying coffee at a coffee house
- eating out at restaurants
- buying high-end items like handbags, name brand clothing etc.
- cable TV
- new vehicles
When you look at your budget you may notice other areas that are a luxury to your family but are not a necessity.
Try cutting back on some of these luxuries so you do not feel pressured to keep up with everyone else. You can drive a used car. You can cut cable TV and use a cheaper streaming service. You can eat dinner at home or make coffee in the morning.
Luxuries are not needed and can cause you to worry about overspending.
Learn to Say No
This is one of the hardest lessons but it is necessary to help you be content with your life.
You need to learn to say no to spending money when it is not a priority for you. You are in control of your finances and have the power to spend your money any way you want.
You also don’t need to give a reason for saying no. No is a complete sentence.
Saying no is not easy but it is necessary to relieve some constant anxiety about money.
Be Kind To Your Future Self
To stop worrying about money today you also need to think about your future self.
Every financial decision you make today can have a significant impact on your finances tomorrow.
Take investing for example – if you start investing in your 20s you’ll have longer to reap the benefits of compound interest. If you put investing off for 10 years you’ll have far less in your bank account.
The power of being kind to your future self can set you up for financial success.
Create Multiple Sources of Income
One of the best ways to be kind to your future self and stop worrying about money is to create multiple sources of income.
These multiple income streams can help you pay off debt, build your emergency fund, and build long term wealth.
The 7 income streams are as follow:
- Interest Earned
- Capital Gains
- Rental Income
- Business Income
You may not be in a position to use these types of income streams at the present moment. However, you can take on a second job or start a side hustle to increase your income today.
Stop Emotional Spending
Emotional spending is making purchases that you don’t need because you are stressed, bored, unhappy or a number of other emotions.
These purchases may give you a small hit of dopamine and create a sense of happiness for a short period of time. However, the purchase usually leads back to worrying about money and overspending.
There are a few ways you can stop emotional spending – just remember you won’t be able to change this habit overnight.
- avoid impulse purchases
- limit your exposure to advertising
- limit temptation
- have an accountability partner
- find alternative activities
Enjoy Your Money
Another way to reduce the stress surrounding your money is to simply enjoy your money.
You should not overindulge and overspend your money. I simply mean make purchases that excite you and bring you joy.
Budget for a date night and don’t feel bad about spending the money.
Go on vacation and don’t feel guilty.
You need to find a balance between your financial goals and actually enjoying the money you do have.
Communicate with Your Spouse
Communication is key when it comes to personal finance especially if you are married. If your finances are combined you need to be on the same page with your financial goals and budget.
You should be having a monthly budget meeting where you go over your finances for the month and what is coming up ahead.
Every month is different so you can not simply copy and paste your budget from the previous month and expect it to work flawlessly.
Having a weekly budget meeting is also important. This ensures you are both on track with your spending for the week and you can make any changes necessary to your weekly spending plan.
You will also want to communicate about your goals and dreams moving forward. It is important to keep the lines of communication open.
Create Healthy Financial Habits
Creating healthy financial habits surrounding your money is essential to your overall financial success.
- create a monthly budget
- weekly budget check-ins
- automatically transfer money to savings
- plan your purchases ahead of time
- save for things that are important to you
- pay yourself first
- track your financial progress
- autopay your bills
- invest in your future
Stick To Your Goals
Having a vision for your future will help you stress less about money. It will help you see the bigger picture and guide your decisions on how to spend money.
I am a firm believer in creating a 1-year vision and then breaking that down into smaller monthly goals.
It is easy to say I will pay off $12,000 in debt this year but in January or February, that number may look out of reach. If you break this goal down in $1,000 monthly or even $230 weekly it becomes much more realistic.
You will also want to create a vision for more long term goals.
When do you want to retire? When do you want to have children? Will you buy a new house? Do you need to replace a vehicle?
These questions are important because they will also dictate how you spend your money today and how much you need to save for future purchases.
Get Expert Help
If you have tried everything above and you are still worrying about money it may be time to hire an expert.
There is no shame in this and it may help you see the bigger picture and figure out a plan that will work for your specific situation.
Expert help comes in many different shapes.
A financial coach can help you walk through your financial worry and help you set up a budget and a plan that will work for your specific situation.
A certified public accountant can help you walk through your tax situation and ensure that you are doing everything possible to reduce your tax liability.
A financial planner can help you see the overall picture and plan for the future.
A lawyer can help you with your estate planning and setting up a power of attorney in the event that you will need one. A lawyer is also essential if you are considering divorce or bankruptcy.
An investment advisor can help you decide on the best course of action for retirement and everyday investing.
A life coach is essential to helping you with your overall mental health and working on different areas of your life. A life coach can help you manage your thoughts and actions surrounding money.
No matter where you are in your financial journey hiring an expert can be a great way to help you manage stress surrounding money and start living your life!
Enjoy Your Life
Worrying about money is not a productive use of your time. You should do everything in your power to work through your worry so you can start enjoying your life again.
The main ways to stop worrying about money are:
- Simplify Your Finances
- Have an Emergency Fund
- Be Content with What You Have
- Be Kind To Your Future Self
- Communicate with Your Spouse
- Create Healthy Financial Habits
- Stick To Your Goals
- Get Expert Help
Once you overcome the stress surrounding money you will be able to enjoy your purchases, not feel guilty when spending money and plan for the future you want.