Your palms are sweaty, you haven’t been able to sleep soundly for a week, and your stomach’s in knots. If you think that’s from last night’s pizza, think again. You’re probably suffering from a little something called financial stress. But don’t worry—you’re not alone.
You guys, 78% of Americans are living paycheck to paycheck . . . every single month.1 Not only are you seeing your bank account dwindle, but you’re also feeling it. Another study by the American Psychological Association found that 60% of Americans feel stressed about money.2
So, what can you do? Make more money? Maybe in some cases. But oftentimes, this nice little salary boost can lead to spending even more money on all those things you’ve been keeping in your online shopping carts. Sounds nice, right? But if you’re not careful, that kind of spending could cost you your health, your relationships—and maybe even your future!
What Is Financial Stress?
Financial stress is worry, fear and anxiety about finances. Sometimes, it can even cause physical symptoms like insomnia, headaches, fatigue and more.3 And if you’ve ever experienced any form of stress when it comes to your money, you probably know exactly what that feels like.
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Financial stress can sneak up on you out of nowhere. Usually, you know exactly what it is when it rears its ugly head (it’s not pretty). But the surefire way of figuring out if you’re suffering through financial stress is by identifying the symptoms. Here’s what to look for:
- Difficulty sleeping
- Gaining/losing weight
- Physical and health issues
- Poor coping habits
. . . and that’s just to name a few.4
Financial stress has also taken a toll on marriages nationwide. Ramsey Solutions did a study in 2017 that found that money is the number one issue married couples argue about: “41% of couples who have consumer debt say that they argue about money and it’s what they argue about the most.”5
Listen guys, financial stress doesn’t have to take over your life—or your marriage. It’s time to change your money mindset.
How to Deal With Financial Stress
It’s time to leave behind that stress and start taking control of your money (and your health)! Here are some ways you can start getting your life in order today:
1. Take inventory.
I know it’s scary, but it’s time to open that junk drawer you’ve been stashing all those old bills in. Believe me—just because the problem isn’t in plain sight doesn’t mean it’s not there. And it may not seem like it now, but facing those bills head on is the most helpful thing you can do to start relieving your stress.
2. Make a budget (and stick to it)!
It may seem weird, but a budget actually gives you more freedom! Taking inventory of your bills will help put you back in the driver’s seat of your finances. So once you know what you’re dealing with, you can come up with a plan of attack—a zero-based budget:
- First, write down your income, then your expenses.
- Now, subtract your expenses from your income until it equals zero! Don’t worry, that doesn’t mean you have nothing in the bank. It just means you’ve given every single dollar a purpose and a job to do.
Making a budget each month will help you determine if you’re spending more than you make and, if so, where you might need to cut back. I hear all the time that people feel like they’ve gotten a raise once they do a budget—and who doesn’t love finding money?
3. Pay off all your debt.
Yup. I mean all of it. You already know how stressful it is to have to worry about paying your bills when you’re already living paycheck to paycheck. Just imagine what it would be like if you didn’t have to keep giving your paycheck to student loans, credit cards, medical debt, vacations and more. Seriously—just imagine!
When you know your why, you’re ready to start attacking that debt with a vengeance! And I’ve got a plan for how to do just that: It’s called the debt snowball. Here’s how it works:
Step 1: List your debts smallest to largest, regardless of interest rate. Pay minimum payments on everything but the little one.
Step 2: Attack the smallest debt with everything you’ve got. Once that debt is gone, take that payment (and any extra money you can squeeze out of the budget) and apply it to the second-smallest debt while continuing to make minimum payments on the rest.
Step 3: Once that debt is gone, take its payment, and apply it to the next-smallest debt. The more you pay off, the more your freed-up money grows and gets thrown onto the next debt—like a snowball rolling downhill.
It’s worth mentioning: If you’re in the middle of any kind of emergency (like a job loss, major home repairs or a medical crisis), things may need to look a little different.
The best thing to do in that case is only pay minimum payments on your debt and focus on taking care of your Four Walls instead: food, utilities, shelter and transportation. This will help you stay afloat until things get back to normal.
And if you’ve got debt collectors calling, your priority should still be taking care of you and your family—the credit card company can wait!
4. Follow the Baby Steps.
Baby steps aren’t just for babies. In fact, the 7 Baby Steps are the best way to get you from broke and broken to building wealth and giving.
The Baby Steps cover everything from saving for emergencies, paying off debt, and investing to saving for your kid’s college fund, paying off your home, and building wealth so you can give generously.
With each step, you’ll feel the stress and worry fall away as you journey toward financial contentment.
5. Practice gratitude.
Speaking of contentment . . . They say the grass is greener on the other side. But the truth is, if you’re taking care of your own lawn, you don’t even notice the neighbor’s. Want to know why? Contentment.
If you want to get rid of financial stress, you’ve got to do things differently than the way you’re doing things right now. And it all starts with addressing your “want-itis” (the urge to buy things just because you want them). Keeping up with the Joneses on social media won’t actually lead to contentment. It will only get you further and further into debt.
Learn what triggers your want-itis and start limiting your exposure to that thing. (Yup, I’m looking at you, social media!) If waking up and scrolling through social media is a habit that leads you to your next purchase, it might be time to take a break.
No matter what kind of financial stress you’re going through, there’s always hope! And I’m here to help you take your next step. You can achieve financial security by overcoming your hang-ups around money. That’s exactly what I want to help you with in my upcoming book, Know Yourself, Know Your Money. Preorder your copy and get over $50 in free bonus items, including the audiobook, e-book, and an exclusive video lesson from me!
About Rachel Cruze
Rachel Cruze is a two-time #1 national best-selling author, financial expert and host of The Rachel Cruze Show. She has appeared on Good Morning America, TODAY Show and Live! With Kelly & Ryan, among others. Since 2010, Rachel has served at Ramsey Solutions, where she teaches people to avoid debt, save money, budget and how to win with money at any stage in life. Follow Rachel on Twitter, Instagram, Facebook and YouTube or online at rachelcruze.com.