It's one thing to get stressed about money from time to time, such as when an unplanned bill lands in your lap or you're forced to take a pay cut at work. But for some people, money is a perpetual source of tension.
Financial anxiety negatively impacts 65% of Americans' overall confidence and 64% of Americans' mental health, reports digital wealth manager Personal Capital. Not only are money woes hurting U.S. adults individually, but they're hurting their relationships. An estimated 56% of Americans cite finances as their single largest source of relationship strife. And among parents, 34% claim that money has a negative effect on their relationships with their partners.
If you're tired of suffering from financial anxiety, there are a few things you can do to break out of that cycle. Here are a few to start with.
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1. Have emergency savings
Having money in the bank could help you avoid a world of stress when unexpected expenses pop up. That's why you should make an effort to build an emergency fund -- enough money to cover three to six months of essential living expenses. Building an emergency fund is so important, in fact, that it should trump all other financial goals you have, like saving for retirement or paying off debt. A good 66% of Americans say that unanticipated expenses are their biggest driver of financial anxiety, but having that cushion in the bank can definitely help.
2. Stick to a budget
It's easier to manage your money when you follow a budget, so if you don't have one in place, now's the time to set one up. All you really need to do is list your recurring monthly expenses, factor in sporadic expenses (like annual subscription renewals), and see how your spending compares to what you earn. Ideally, you shouldn't be depleting your entire paycheck month after month; rather, there should be money left over for savings (first of the emergency and then of the retirement variety). If that's not the case, then you'll need to rethink your expenses and cut back as much as possible. But having that budget on hand will help you keep tabs on your finances to avoid having them stress you out quite so much.
3. Talk about money openly with your partner
Money can be a major source of conflict in relationships, but if you and your partner are open and honest about it, you might lower your stress load in the process. If you've yet to talk finances with your partner, sit down and discuss things like your near- and long-term goals, your existing debt, your current challenges, and potential solutions. That way, you can work together to meet objectives and tackle issues that are keeping you up at night.
In an ideal world, money wouldn't be a large source of stress. In reality, it's an anxiety-causer for many Americans, and that includes those who earn a reasonably comfortable living. Rather than let money issues wreak havoc on your well-being, attack those problems head-on. Your health and happiness depend on it.
