What to Do If You’re Stressed About Money

What to do if money stresses you out

Being stressed about money is not cool.

All the thinking and worrying only serves to bring you down. You start to feel paralysed by your situation.

It especially doesn’t help if you believe other people around you are really happy with their money. You can start to feel liked you’ve ‘failed’ in some way.

Money stress isn’t limited to people who are in debt or who earn a certain amount of money. You can have a positive net worth or a great income and still get stressed about money.

When you break it down, there are four factors that to money stress.

1. You’re Over Your Head

If what’s going out of your bank account each week is more than what’s coming in, then you’re on the fast-track to Stressville. You may be relying on credit cards to get you by, or counting on a big (but maybe not realistic) bonus to even out the year. If things get really dire, then you may look to declare bankruptcy or tap into your superannuation. Argh, major stress.

2. You’re Scraping By

If at the end of each month you’re left with a dollar in your bank account and five packets of 2-minute noodles in the cupboard, then I’m guessing you’re not feeling all rainbows and unicorns. Even the slightest bump in your budget – a car repair or broken appliance – could spin you out completely. Just like Aerosmith said, living on the edge is not a fun place to be.

3. Being in the Red

Borrowing is pretty much a fact of adulthood. We borrow for our education, borrow to buy a house, maybe even borrow to fund your investments. But owing a lot of money can be a source of stress – even if you can meet the repayments.

This is especially so if your debt is due to something that has declined in value – like say a car or (sadly) a house. You’ve got no choice but to keep paying the debt, or risk losing a lot of money if you sell.

4. You Don’t Know What’s Going On

Pile of unopened mail on the counter? Haven’t checked a credit card statement since January – last year? You might have a healthy bank account and feel like you’re getting by. But without the full picture of your finances, there’s always that nagging feeling that something is going unpaid/missed/or forgotten about.

(True story – I once dated a guy who had an entire shoebox of unopened mail, which totally stressed ME out.)

How to Deal with Money Stress

Okay, so if you’re stressed about money what can you do? Obviously there’s the standard responses of make more money and spend less money. But if you’re totally overwhelmed by your situation then that advice can seem a little glib.

Get the Full Picture

You know that scene in Shopaholic where Isla Fisher’s character, with the help of tequila, finally opens all her credit card bills and debt notices to figure out exactly what she owes.

Yeah, you’re gonna do that. Seriously. You can choose whether it’s over a glass of wine or a cup of tea.

Sit down, open all those envelopes (or download your statements if you’re online), and just write down those totals. No judging or I wishes. Just write it all down.

Chances are your situation isn’t as bad as you’ve been thinking it is. And if it’s actually worse? Well it’s easier to fight a battle if you know who the enemy is.

Focus on a Quick Money Win

If I’m starting to feel stressed about my money situation, often I’ll just go and upload half a dozen things on Gumtree to sell. Sure, I may only make $40 from the lot. But that quick cash-win can be energising and reminds me that I’m more in control of my earnings than I think.

Your quick win might actually be saving money. Maybe a 10 minute conversation with your phone company to change your plan. Or committing to eating only from what’s already in your cupboard for the week.

Tackling an easy challenge will help you to change your mindset around money and empower you to tackle those bigger money worries.

Speaking of which…

Understand What’s Really Worrying You

Often our stress triggers aren’t actually what’s really bothering us. Maybe you get stressed about your weekly grocery bill, but actually what’s really worrying you is how much money is going towards rent.

Or maybe you get stressed about going out for drinks with the girls, but your major problem is really that you’re not earning enough at work.

If you can figure out what the underlying cause of your money problems are, you’ll be one step closer to reducing your anxiety around money.

Don’t Be Afraid to Get Help

Money stress can feed into all other aspects of our lives, causing you to feel totally overwhelmed.

Getting some outside perspective can help you get back in control. You could speak with a trusted friend or family member or, a financial expert. You speak with a financial counselor in Australia for free, and they can also help you to negotiate with your creditors if you need some more breathing space to pay back your debts.

No matter what you do, remember that your financial situation isn’t a reflection on who you are. By working through your money stress, you can become stronger and better able to face to other problems that come up.

PS 6 Money Mindsets That Are Keeping You Poor | How To Make Money at a Second Hand Market

Do I Need a Will If I’m Young, Single and Broke?

If Hollywood movies have taught me anything, it’s that Wills are a quirky plot device to be used by writers of romance and comedy movies to set up their stories and lead to a happy, yet expected ending.

Okay, so Wills are a necessity for more than just kooky rich relatives.

Having a Will means that your assets are distributed in a way that makes sense to you, taking into account dependents, friends and even causes that you care about.

But what about if you have very few assets to your name and no dependents to speak of?

Do I Really Need a Will If I'm Single, Young and Broke

Do you really need a Will if you are young, single and broke?

A little while ago I stood firmly in the ‘no’ camp. Although my possessions mean a lot to me, I really doubt my family is going to fight over my scooter and laptop once I’m gone. And I’ve got (comparatively) very little in the way of investments and liquid assets. Sure, I’ve got a bit of life insurance through super, but other than that I’ve very little to my name.

I figured that if I were to leave this party early, my family could just sort out what happened to everything pretty amicably.

So like I said, writing a will wasn’t even on my radar.

And then I talked to my Mum. I’ll tell you what, having a lawyer in the family is both a blessing and a curse. After telling her that I didn’t have a Will yet, I got a ten-minute lecture on how important it is to have one even if you are broke and young.

[Sidenote: How old is too old to still be getting lectured by your parents?]

Anyway, my Mum did bring up some valid points so here’s a few reasons why you should consider writing a Will.

1. You have a significant Significant Other

My boyfriend and I took the step of moving in together earlier this year. We haven’t combined our finances or set up a joint bank account or anything yet. But obviously our relationship is getting more serious and we’re starting to talk more about our future life together.

As my Mum pointed out to me, if one of us were to die now, the other person would sort of be in limbo financially. Sure, it would suck to lose my boyfriend. But it would also be really horrible to have to pay for our joint expenses on my own, have to move out of the house, and even try to figure out what happens to furniture and other stuff we’ve brought into the relationship.

So as your relationship progresses and more of your life and finances become entwined, it’s important to work out what should happen if one of you were to die. For example, will you leave each other money to set up at a new place or cover joint expenses?

2. You have a close relationship with non-dependents

If you die without a Will, you are considered to have died intestate, and your assets will be distributed according to a standard set out by the Trustee in your state.

If you’re single, your assets will generally be given to your parents or siblings. But that may not be what you want to happen.

I’ve got a (gorgeous) niece and nephew and I’d like to leave them something to help out with their education or buy a house down the track.

Without a Will, I’d have to depend on my family to just know this is what I want. But if it’s included in a Will then I know they’ll get the money and it will be used in the way I want.

3. You want to leave money to charity

If you’ve got a cause close to your heart, you might want to leave some money to a charity that supports it. You can include charitable bequests in your Will so you know that your money will go towards a cause that you care deeply about.

You can also include in your Will certain things that you want to have happen at your funeral or wake (like no playing ‘Wind Beneath My Wings’).

How to Write a Will

Writing a Will isn’t all that hard. The hardest thing is gathering together details of all your assets and expenses and then working out where you want it to go.

You can buy a Will Kit from your state trustee and this will take you through all the requirements. It’s important that your Will is witnessed by two people who aren’t beneficiaries.

Although my Mum pointed out that if you want to make sure that everything is done right, it’s probably better to get a lawyer to draw it up for you. This obviously isn’t the cheapest option.

After You’ve Got a Will

You’ll need to review it regularly. Things change. Maybe you get married, buy a house, have children or buy or sell assets.

Review your will each time you have a big life change (plus maybe annually too), to make sure that it still reflects your situation. In fact, a Will is automatically revoked if you get married so you’ll definitely want to review it if that happens.

Sure, thinking about what will happen once you die isn’t the funnest thing. But it is important. And once it’s done, that’ll be one less thing your Mum can nag you about.

Right, I’m off to figure out what I want in my Will. In the meantime, tell us if you have a Will yet? What made you decide to write one?

Photo credit: Flickr/keremtapani