Financial stress can impact anybody, irrespective of economic status. It severely affects mental and physical health. For example, it can lead to depression, sleep concerns, headaches, heart disease, diabetes, muscle pain, etc. According to reports, around 26% of Indians feel stressed due to their current work situation, while 17% report stress due to financial instability.
Exploring how to deal with financial stress becomes crucial during economic uncertainty.
What Does Financial Stress Mean?
Financial stress refers to the emotional strain caused by money-related challenges. It is usually found more among people with low income levels. It can arise from the inability to make adequate money to meet needs like paying bills, rent, and purchasing essentials.
Negative effects on your mental and physical health are perceived if your financial stress is severe. Consult with a healthcare professional if you face any side effects associated with financial stress. Before getting into the details of how to deal with financial stress, let’s understand its potential consequences.
Consequences of Financial Stress
Here are some major consequences that can be found in people facing financial stress:
| Consequence | Description |
| Insomnia or Sleep Difficulties | Financial worries can keep you awake at night, leading to restlessness and poor-quality sleep. |
| Disturbed Appetite | Stress may cause skipped meals to save money or overeating due to anxiety, leading to weight loss or gain. |
| Depression and Hopelessness | Constant money problems can result in emotional distress, making it hard to focus or make sound decisions. |
| Suicidal Thoughts | In severe cases, financial stress can trigger thoughts of self-harm or suicide. |
| Social Withdrawal | You may prefer isolation, avoiding friends and family, which can worsen your emotional well-being. |
Smart Ways to Deal With Financial Stress
Staying financially stable during money troubles can be challenging. However, these simple tips can help you get things back on track:
1. Prepare a Monthly Budget
Preparing a monthly budget helps you avoid spending more than your income. It clearly outlines where the money goes and highlights chances to save or invest.
To prepare a budget, begin with your net income, i.e., the amount you take home after taxes. Then list your regular expenses like rent, mortgage, groceries, and other essentials. It also helps to set up automatic payments for recurring bills, so nothing gets missed.
Remember to sign up to get notifications if your balance drops below a certain level. This way, you can stay on top of your finances, tackle potential money issues early, and feel more confident managing financial stress.
2. Focus on Self-Care
Managing money-related stress involves maintaining a healthy lifestyle. For example, you can exercise for 20-30 minutes daily and practice meditation. You will find a remarkable improvement in your physical and mental health. Moreover, you can walk for 30 minutes daily or indulge in a workout session to relieve stress.
Several resources exist to relax your mind and body. You can enjoy your favourite fun activity, socially connect with others, and unwind in the lap of nature.
3. Build an Emergency Fund
Coping with financial stress becomes simpler if you set money aside for an emergency fund. For example, you can set some amount of money for illness, job loss, repairs, etc., to alleviate financial anxiety. Build an emergency fund covering at least six months of daily living expenses. Getting into the habit of setting aside a little regularly can give you peace of mind when unexpected financial setbacks come your way.”
Review your budget and see how much you can save each month. Setting up automatic transfers from your checking to your savings account can make it easier and ensure you don’t forget to put money aside regularly.
4. Pay off Debt
List all your debts, no matter how small or big they are, regardless of the interest rate. Start paying the smallest debt with available resources. After repaying that debt, take that payment (and some other money you can manage from somewhere) and use it to repay the second smallest debt.
Simultaneously, you need to continue making the minimum payments on the rest. Remember, the more you repay, the more you can free up the due and gradually become debt-free.
5. Get Professional Help
Financial advisors offer personalised guidance on saving, investing, and managing debt. Their advice serves as a solution to how to manage financial stress.
Financial therapists or counsellors specialising in financial stress can assist with the emotional aspects of your financial setbacks. You can get help from non-profit organisations or community resources to streamline stress management and financial planning.
6. Get an Extra Source of Income
Having an extra source of income can act as a financial safety net. It reduces dependence on just one paycheck and adds more stability. You can showcase your expertise and experience on freelance platforms to connect with clients.
You can even work part-time, tutoring, food delivery service, retail work, etc., to generate an additional income stream. It is better to seek flexible options that suit your schedule without negatively affecting your main job role.
Manage Financial Stress for Peace of Mind
Money-related emotional tension can significantly damage your self-esteem. It can disrupt your physical and mental well-being and social life. The discussed tips can serve as hope when you are confused about how to deal with financial stress and achieve financial freedom instead.
