Money is an essential aspect of our lives and one that affects everything we do. From paying bills to buying groceries and even planning for the future, we need money for everything. The thought of not having enough of it or struggling to make ends meet can be extremely stressful and can take a toll on our physical and emotional well-being.
If you want to stop stressing about money, I’ve definitely been there myself and it can be frustrating. I’ve stayed up at night worrying about money and debt while wondering how I’d make ends meet. There is a light at the end of the tunnel. That may seem hard to believe given everything that’s happened in recent years and how much expenses have increased.
In this blog post, I’ve compiled 5 simple and effective ways to help you stop stressing about money.
1. Create a Budget
One of the most important things you can do to stop stressing about money is to create a budget. This means creating a plan for how you will spend your money each month and sticking to it. A budget will help you identify areas where you can reduce expenses and save money.
You can also use budgeting apps or spreadsheets to track your expenses, making it easier to stick to your budget. This year, my husband and I started using a budgeting app called Simplifi and we love it. We also decided to combine finances so we just have one shared checking account now. This is not something I ever thought I’d do.
Over time though, I realized that we have to merge our financial goals and get better at being on the same page. Since combining finances completely, I’ve felt much more confident about our financial situation overall and we communicate more frequently about our budget.
Remember that a budget is just a spending plan to lay out how you’ll use your money. Instead of feeling like you’re not in control of your finances, using a budget helps you take charge of deciding where your money will go. Just be sure to check in on your finances and monitor your spending regularly so you can make adjustments as needed.
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2. Set Realistic Financial Goals
Setting financial goals is important, but it’s equally important to set realistic goals. Identify your short-term, medium-term, and long-term goals, and create a plan to achieve them. Ensure your goals are achievable and don’t require sacrificing your basic needs.
I like to make my goals visual by using a chart to track my progress or by printing out a picture of the goal I’m trying to reach for motivation. Realize that motivation is also not always going to be there and it’s more important to focus on developing strong habits that help you work toward financial security. Some of those habits can include:
- Committing to a budgeting method or strategy
- Limiting unnecessary shopping
- Packing your lunch for work
- Canceling unused subscriptions
- Cooking most meals from home
- Paying off your credit card balances in full each month
- Paying yourself first and prioritizing saving
Celebrate your accomplishments, track your progress, and consider short-term goals that are easier to reach. This could be something simple like sticking to a meal plan for the week or paying down your lowest credit card balance by the end of the month.
These smaller goals will help you stop stressing about money as much as you regain control of your finances.
Related: How to Achieve Goals You Set This Year
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3. Start Saving 5% – 10%
If you’re not saving a portion of your income, even if it’s a small amount, this is something to prioritize. I know if you’re already stressing about money it may be challenging to find any extra cash to save. Still, this is where your budget can come in handy to help you identify expenses to cut back on. Even if you’re only able to save $25 per paycheck, saving something is better than nothing.
Unexpected expenses can arise at any time, and having savings or an emergency fund can help you stop stressing about money when situations arise. Your emergency fund should consist of 3-6 months’ worth of expenses. But don’t let that overwhelm you. Start small and save what you can each month, even if it’s just a few dollars.
Over time, graduate to setting aside 5% to 10% of your income each month. Then, make it automatic so you can save without thinking about it. Your emergency fund will grow, and you’ll have peace of mind knowing that you have a cushion to fall back on when you need it.
If you’re serious about building a financial safety net, check out my 4-part masterclass that helps you build an emergency fund fast.
Related: 70 Ways to Save More Money While Living Paycheck to Paycheck
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4. Find Ways to Supplement Your Income
If you’re feeling strapped for cash, exploring ways to supplement your income outside of your day job may be worthwhile. This could mean anything from freelancing in your field to taking on a part-time job or selling items you no longer need.
The key is finding something that fits your schedule and doesn’t add unnecessary stress or burnout. I always recommend that people consider their interests and skills. Start with the obvious choice and choose a side job idea that you can do easily and efficiently.
If you’re stuck on where to start, begin going through your home and sell items you no longer want or need. You never know what people will buy and this is one of the easiest ways to get some extra cash quickly.
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5. Reduce Your Debt Strategically
If you’re carrying debt (like credit card balances or student loans), it’s easy to feel like you’ll never get ahead. But the truth is, by focusing on getting out of debt, you’ll be able to free up more of your money to put toward your financial goals.
Start by identifying which debts have the highest interest rates and prioritize paying those off first. You may also want to consider consolidating your debts into one payment or negotiating with creditors to lower your interest rates.
Be strategic and focus on tackling one debt at a time. When I first got started on my debt repayment journey, I decided to pay off the debt with the highest interest rate – my car loan. I paid the minimum payment on all my other debts at the time and zeroed in on my car loan.
The monthly payment was around $230 but I started rounding up to pay a total of $300. Then, I was able to double my payment. Before I knew it, I was managing to put $700 on my car and sometimes more some months. I managed these larger payments with help from side hustles, budgeting, and staying focused on one thing at a time.
When you pay down debt, you instantly give yourself a raise and free up funds in your bank account. It’s not easy, but it’s worth it if you want to stop stressing about money.
Summary: Stop Stressing About Money When You Commit to Living Differently
Managing money can be challenging, but it doesn’t have to be stressful. To stop stressing about money, you have to adopt a different lifestyle. The way you think and live has to change because if you’re stressed, it means something currently isn’t working. If you have debt, you won’t be able to make progress by paying your balances down if you don’t commit to cutting your expenses and throwing extra money toward your balances.
If you don’t budget, you can’t expect to know where your money is going and have financial stability. Start by setting small but realistic goals and ensure you’re on the same page if you have a partner. Visualize your life when you no longer worry about money and imagine how that person lives and what habits they have.
Stick with these 5 tips, and before you know it, you’ll stop stressing about money and regain your financial confidence.
Stop Worrying About Money and Regain Control
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