1. Start Tracking Your Spending
Have you ever wondered where all of your money is going? Tracking your spending is a great way to find out. This will enable you to see which expenses are essential, if there are any expenses that you can cut, and if there is any money that you can save. You might be able to cut your daily Starbucks or a streaming subscription you’re not using. By tracking your spending, it will help empower you. Once you know where your money is going, then you know you can do something about it.
2. Create a Monthly Budget (and Stick to it)
Tracking your spending means that you can create a monthly budget. If you don’t already have a monthly budget in place then now is a great time to start. Having a budget means that you will reduce the likelihood of overspending and it will also feel good knowing that you are sticking to your plan.
There are so many apps and tools that you can use to create a budget such as Mint or YNAB. You can also use pen and paper, your journal, or a spreadsheet. It doesn’t need to be complicated. While creating a budget can cause some additional stress at the start, once you have a budget and know where your money is going each month, it puts you back in charge of your money.
3. Build an Emergency Fund
Building an emergency fund to cover unexpected expenses can make you feel more financially secure. If you lose your job or need to pay a large medical bill, having money in an emergency fund will help reduce the financial stress. You don’t want to be in a situation where you are adding financial stress on top of an already stressful situation. You want peace of mind and an emergency fund can provide that.
If you have any debt, then you may want to start with a smaller emergency fund. Try to find somewhere in your budget where you can put away $100 a month. This will quickly add up over the year. Once you are consumer debt-free, we typically recommend an emergency fund amount of 3-6 months worth of essential expenses. How much you want to save is entirely up to you. The goal is to reduce your financial stress.
4. Set Up Automations
- Savings: Setting up automated saving transactions is a great way to “force” savings. It can help reduce the likelihood of spending that money on unnecessary items. You will feel good knowing that your savings are growing with each paycheck.
- Bills: You can also set up automatic payments for your bills. This will reduce your financial stress about missing a bill and it will also save you time. It’s important to still keep track of your bills to ensure that they are the same amount that you budgeted for.
5. Consider Adding an Additional Source of Income
You can only cut your budget so far, and sometimes a tight budget can cause additional stress. Adding an additional source of income means that there will be more money coming in to cover your expenses.
There are a variety of ways that you can add an additional source of income. Ask for a raise from your boss. You can also see if you can work a couple more hours for your current job if you earn an hourly wage. Try getting a consulting gig on the side, or make YouTube videos. However, be realistic with your time and make sure that you take care of yourself.
6. Get Out in Nature
Take a brief walk outside. Spending just 20 minutes in nature can reduce your stress. You could go for a hike, take the kids to the playground, or go relax at the beach or lake. It’s free and the fresh air is good for the soul! Spending time in nature is not only good to reduce your stress, but it also reduces anxiety and boosts your feeling of happiness.
7. Consider a Financial Advisor
Sometimes financial problem-solving can be too big to handle on your own. It can also cause a lot of stress trying to work out what the best financial strategy is for your unique situation. A financial planner can help you identify your financial challenges and opportunities, and create a long-term saving and investing strategy. This will help address your current financial needs and plan for the future. Knowing that you have a financial expert overseeing your financial situation can help you feel more in control of your financial future.
