Financial anxieties: Factors and how to curb them
Financial anxiety haunts many people. The fear of financial disaster can lead to significant stress in your lives. Financial anxiety can arise due to huge unpaid debts, less income, no savings for retirement, and loss of a job. Due to excessive financial pressure, your lifestyle can suffer. This causes you to be irritable. Your bad financial life your relationship with your family members as well. Rising financial stress is known to be the cause of emotional distress, depression, and anger. Under such high levels of anxiety, you may tend to become very agitated and create an environment that will become uncomfortable for your loved ones. It can cause major health consequences that may affect you for many more years to come.
Financial anxiety indeed affects your life adversely. Thus, it is important to find out ways to mitigate the financial problems that create stress.
However, before finding ways to curb financial anxiety, it is important to find out the factors that are responsible for the stress.
Factors that are responsible to bring financial anxiety
Many people can't identify the exact reason for their financial stress. As a result, they are unable to take the required precautions to get back into their normal life. However, Day by day the percentage of debtors is moving up. The employment scenario is also not getting cured, Many people can't repay their student loan debts due to low pay or no job. These are the causes of financial stress in many people. Here are some other factors that cause financial stress in people.
1. The unstable economy and lack of good employment
Due to the unstable economy, employment market never becomes good for newbies who are looking for a good job just after completing their studies.
But, unfortunately, many new graduate students are not getting jobs. They are staying with their parents and earning a small amount that is not sufficient to start a family. This creates stress in them.
2. Extravagant lifestyle
Life is not as colorful as it seems to be. But people tend to make this mistake. They spend excessively to lead a luxurious life like eminent personalities. They don’t have the concept of saving money. They tend to spend all of their earnings. You shouldn’t do this. Instead you must have the habit of saving your money. Try to cut down your expenses so that you're able to save a good amount of money. This saved amount will help you manage your financial situation.
3. Irresponsible handling of credit cards
Most of the Americans think that it’s mandatory to take your credit card when you’re moving out. They prefer using plastic cards instead of cash to make their purchases. But they are not at all responsible to pay their bills on time. They keep on ignoring it. As a result, debt seems to spiral up. Thus, when you’re using a credit card you must make sure that you pay your bills on time. If not in full, at least make minimum payments on your cards so that you're able to manage your financial situation even in a tough time.
6 Ways to curb financial anxieties
Well, once you find out the reasons that are causing financial stress in you, you need to try to mitigate them. By doing this, you can curb the financial anxieties in your life.
Here are 6 ways to get out from financial anxieties.
1. Focus your attention on earning money
Without a good income, you can make a change in your financial life. So, it is advisable to start earning money, with which you can either pay off your existing debt or save for your future. You may not get the chance to earn a fair amount from a good job. But there are hundreds of other ways to earn money.
For example, you can give tuition to students
You can set up an online business without spending a pie
You can hold a garage sale
You can write articles for publishers
2. Negotiate a debt settlement with creditors
If your huge credit card debt is causing financial anxiety, then contact the creditors and start corresponding with them. You might be surprised to see that creditors are most likely to work with you. Remember, creditors will work with you if you start communicating with them. Tell them that you are willing to pay your debt but do not have the total balance this time. Explain your financial hardship and request them to reduce the payoff amount. Once the creditors agree to your proposal, ask them to allow you to pay in several monthly payments.
3. Declare bankruptcy
If your present financial condition is not up to the mark to repay your current debts. And, you don't have a job, then bankruptcy is the only way to get out of this tremendous financial stress. Bankruptcy is a legal status of an insolvent person, that is, one who cannot repay the debts owed to creditors. This is a viable way to deal with the debt while unemployed since it discharges a certain percentage of the debt. However, the downside is that it injures the credit score, which is likely to stay for 7 to 10 years. But the good side is you can start afresh and can rebuild your credit score again.
4. Consider passive income
If no savings factor is causing you financial anxiety as you are feeling financially insecure for your retirement days, then consider passive income to boost your savings.
You must try to have a passive source of income so that, if your primary source of income gets disrupted, you can rely on the second one till you get stabilized. There are many part-time jobs available online. So explore then and start earning extra to save extra. Besides, you need to save money in a retirement fund to save for the days when your traditional income will be not there.
5. Set a good emergency fund
Many people take out loans multiple times to manage surprise expenses.
Thus, they always busy in managing their loan payments. This never-ending pressure for paying monthly bill cause stress in their life.
To break this cycle, you need to establish a fat emergency fund.
Once you have an emergency fund, you can use that money to manage an emergency without taking out any loans. So, try to save at least 6-9 months of savings so that you can manage unforeseen emergencies without running out of money.
6. Pay your bills on time
Remember, due bills create enormous pressure. So, don't ignore your monthly bills. If you are running out of money in any month, then without a second thought, use your emergency fund to make at least minimum payments on your loan till the time situation gets stabled. You can also consolidate your bills to reduce the pressure.
Lastly, remember, there are ways to come out from any trouble. But, instead of finding out the way out, getting tensed about the situation will not solve the problem. Ignoring the situation will only increase the anxiety in you. Thus, if your financial life is giving you stress, then find out the reason for that stress and try to solve it.
Discuss the matter of stress with a person, you might get a solution from that person.
So, instead of hiding financial anxiety, face it, solve it.