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How to Deal With Financial Stress & Avoid Panic Mode

how to deal with financial stress

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When you’re feeling financial stress, everything around you becomes harder to deal with.

The smallest bills can cause you panic, and distractions can keep you from being productive at work. Your relationships and family may suffer as your stress overwhelms you at all times of the day.

I know this because I’ve been there.

I, like many others, hit a period where I was in over my head with credit card debt, wasn’t making a steady enough income to always cover my debt payments, and found myself obsessing over every penny spent. And of course, this stress kept me up at night, made me more irritable with friends and family, and actually decreased my productivity, as I wasn’t able to focus on any task at hand.

All I could do was think of running away: run away to my parents if they’d take me or to some inexpensive island where I would never see a credit card again. But these fantasies weren’t real ways to deal with financial stress in a productive sense.

So then I took a step back and stopped my mind’s destructive cycle of panic. As a licensed therapist, I helped my clients figure out how to deal with financial stress and other causes of concern on a daily basis, and yet I wasn’t able to see that I was in the exact same cycle of doubt that they were.

I started at the same place I advised clients to when dealing with stress of any kind: figure out what is causing it, and begin to take meaningful action.

If you want to learn how to deal with financial stress productively, these techniques will help.

1) Visualize The Issue

If you’re dealing with financial stress, you want to start to see just what is causing you to feel this way. Chances are, like me, you don’t have enough money coming in to cover what needs to go out.

But that concept is vague, and that unknown is what is contributing to your stress. Now comes the time to make a budget so that you can see where your money is going, and you can reapportion funds to help relieve some of your most significant burdens. Calculate your income and a month’s worth of expenses, and see where you need to make changes immediately.

Person holding receipts at a table with a calculator and pad of paper with pen.
To reduce your financial stress, you first have to face it.

Not only will a budget keep your spending on track going forward, but knowing that you have the control to change your current situation with your budget will help reduce some of your stress.

2) Give Yourself A Cushion

Another major contributor to financial stress is the idea that you’re all alone, and you have no additional monetary support to help out. Every little problem has the potential to spiral into a larger one, making you panic even more.

When you have an emergency fund, this bit of panic is relieved. You don’t have to worry so much about every problem you face because you know there is a cushion there to protect your fall. Ideally, your emergency fund has six months of living expenses, so that you are covered should you lose your job or face a major problem. However, just a few extra thousand dollars can go a long way to covering the cost of repairs, replacements, or surprises.

Glass jar with emergency savings written on the side.
An emergency fund will help you rest easy.

3) Talk To Others

If you were dealing with work or life stress, you might consider visiting a therapist or calling a family or friend to talk – so why wouldn’t you do the same with financial stress?

Talking to the people close to you about your financial concerns can yield surprising results. First, they may take a step back and look at their own financial situation, finding ways that the two of you can work on your issues together. Second, they may have gone through the same thing and could help you come up with solutions to help. But even if they are just a listening ear, when you can verbalize and share your burden, you’re more likely to feel that it is something you can control.

Couple sitting across from a man in a business suit.
Meeting with a professional can help you explore your options.

If you’re trying to figure out how to relieve financial stress all on your own, consider contacting professional financial help to sort out your problems. If you’re carrying major debt, you may want to look into options for personal loans from Upstart that can help you pay off credit cards and other high balances at a lower rate.

4) Learn To Accept Mistakes

One of the biggest problems I always had, and that I often saw in my clients, was not being able to see mistakes as okay. I would start panicking over spending extra dollars that I hadn’t planned on, which led me to waste the rest of the day wavering between chastising myself and feeling incredibly down. That, of course, made me less productive and more impulsive, which led to an ongoing cycle of stress.

Couple lounging on a couch with their eyes closed appearing relaxed.
Find moments to just enjoy life.

Once I stepped back and looked at this cycle, I saw how to stop it: by starting to accept my mistakes and learn from them. If I spent an extra $15 one day a week on lunch at my favorite café, why spend days worrying about that? Perhaps it was possible to find an additional $15 each week, or potentially once a month, to allow myself this treat. If not, I could give up something else to cover that cost – no harm, no foul. I was proactive with a solution and didn’t spend any more time staying up at night worrying about how much I failed.

5) Remind Yourself Of The Good

There’s a reason that panic and stress feel like a cycle: they are. Often the things we do because of stressful feelings actually make us more stressed in the long run. It’s crucial that you don’t submerge yourself in your financial stress, and that you find ways to remind yourself of all the good in your life. Make an effort to spend time with friends and family without requiring money to be spent – you’ll likely find that intimate settings allow you to connect more anyway.

Take walks to get your head outside of your financial problems, and consider yoga or other forms of exercise that will help you feel more present in the now, not in your money concerns. One of the ways to relieve the financial stress that I found most effective was mindful meditation. For this process, I sit with my eyes closed for at least a minute, but ideally more, and I focus on breathing in and out. As I do this, I imagine my problems passing in front of my closed eyes on a bright, sunny day – as each one moves on it’s like a passing dark cloud. I repeat this for as long as I need to, to help myself disconnect from nagging ideas that are causing me stress.

If you’re feeling overwhelmed, there are ways to deal with financial stress. Start taking control and get a real understanding of your finances as they currently stand, and make any needed lifestyle changes that will help you achieve a better balance. Find ways to pay off debts quickly but in a way that works for you, and don’t be afraid of making mistakes – they’re our most valuable learning tools.


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