Millions have faced financial hardship as a result of the coronavirus outbreak. If you haven’t been directly impacted financially by the economic downturn, you almost certainly know someone who has.
You’re worried about your finances, given the present unemployment crisis, government shutdowns, and an unpredictable economy. It may be causing you to lose sleep.
Here are eight strategies for dealing with financial stress during difficult times.
Determine the most common sources of financial stress.
If the financial concern is keeping you awake at night, start by pinpointing the specific issues causing you to worry. Whether it’s credit card debt or upcoming bill payments, identifying the root of your worry will help you figure out what to do next.
Make a list of your most pressing financial concerns.
To feel less overwhelmed, keep the list small.
Re-evaluate your list every three to six months or as your situation changes.
Prioritize the aspects of your life that you have control over.
You won’t be able to eliminate all of the stressors in your life. Some circumstances are simply beyond your control. If you focus on things you can’t alter, you’ll likely experience additional stress due to your frustration at not being able to change them.
Instead, concentrate on the aspects of your situation over which you have the power to attempt to better your situation. Consider something simple like your food budget as an example. Look for ways to save a few bucks on your grocery bill unless you’re already on a shoestring budget. You’ll not only save money, but you’ll also feel more accomplished and in charge, which may help you relax.
Make a monthly spending plan.
A budget is an effective tool for controlling and understanding your finances. It can assist you in avoiding overspending and saving for future goals. Once you have a complete picture of where your money goes each month, you may look for ways to reroute some of it to the areas that are causing you financial hardship.
Begin with your net income, which you take home after taxes each month.
Make a list of everything you spend money on, from your rent or mortgage to your daily cup of coffee.
Set up regular bill and savings payments to be made automatically.
Sign up to receive notifications when your balance goes below a specific threshold.
Look for ways to make additional money.
You can only cut a budget so far, and you’ll want to make sure it doesn’t become a cause of additional stress. Taking action to enhance your income is another approach to relieve financial stress.
It may appear challenging to improve your income in the current economic climate, but it is not impossible. If your company allows it, the simplest method to earn more is to work a few extra hours each week. If expanding your hours isn’t an option, look for additional ways to earn money. Because of the epidemic, some new alternative ways to make money may become available. Families with home-schooled children, for example, may find that they have less time to take care of typical household responsibilities than they had previously. Many people are willing to pay someone to pick up groceries, trim the yard, assist their children with online tasks, or keep an eye on them while attending virtual school.
Utilize your earnings to the fullest extent possible.
When money is tight, it’s easy to believe that you don’t have enough to deal with your difficulties. However, it’s critical to maximize the money you do have. Recognize that modest steps can build up. You might not be able to save $500 each month on any one expense, but you might be able to find five that you can cut by $100 each.
Divide your expenditure into needs and desires, and then seek ways to reduce your wants list.
Examine your spending habits to see where you might save money on small daily purchases.
Consider changing your budget to prioritize tasks that will help you relieve general financial stress, such as paying off a high-interest credit card.
Invest in an emergency fund.
Having money set aside for an unexpected expense, such as auto repairs, job loss, or illness can help to alleviate financial stress. However, putting together an emergency fund, especially one large enough to cover three to six months’ worth of costs. Don’t get too caught up with the amount; what matters is that you put money aside regularly.
After accounting for the expenses on your needs list, use your budget to estimate how much you can contribute to savings each month.
Prioritize saving for three to six months’ worth of living expenses before moving to longer-term goals.
Make automatic deposits from your checking account to your savings account.
When it comes to debt reduction, be strategic.
Debt from credit cards is a common source of financial anxiety. It’s costly, but it can also stand in the way of your financial goals. The remedy to stress is a debt-paying strategy. Consider employing the snowball strategy (paying off your debts one by one, focusing on the most minor first) or the high-rate method if you have balances on numerous cards (concentrating on the cards with the highest interest rates first).
Pay the bare minimum on each of your credit cards.
Choose a payment method and stick to it.
Don’t get into any new credit card debt.
Consult with experts.
Consider speaking with a financial counsellor to help you with goal-setting, saving money, and debt reduction. And here’s where Unimoni comes to help. We are one of the best in our field and trusted by millions globally.
“The COVID-19 uncertainty has raised financial stress for many people who require money advice from someone they can trust,” says Brian Thorp, founder and CEO of Wealth tender. “Fortunately, most financial advisers and coaches have altered their practices to offer clients online. While technology has proven useful in a world of social isolation, it cannot replace the human element provided by financial specialists when it comes to the emotionally charged subject of money.”
