As we go through another total lockdown, we can’t help but to feel anxious about our finances. Many jobs, hours and wages have been lost with thousands of businesses having to pause operations or permanently close. When facing uncertain situations like these, it is only natural to have an anxiety response, but if your fear has become overwhelming and disruptive, it may be a sign of an anxiety disorder.
Money-related anxiety can cause your stress to reach unhealthy levels. Like other forms of anxiety, it can affect your physical health and daily life, causing insomnia, loss of appetite or inability to focus. If left untreated, anxiety can also develop into depression. Below are some signs often related to financial anxiety:
- “Retail therapy” is real! Spending money is a common coping mechanism when it comes to strong negative emotions, such as sadness and anxiety. Also known as emotional overspending, it is a vicious cycle that temporarily relieves and then worsens stress.
Fear Of Spending
- As important as it is to save money, especially during these times, extreme frugality is unhealthy. Some people with financial anxiety may take frugality too far by overworking themselves and refusing to pay for essentials, like healthcare or house repairs.
- It is common for us to deal with anxiety by avoiding our triggers. However, when it comes to our finances, they are too important for us to ignore. So, when we avoid dealing with our finances, it only causes us more problems and anxiety.
- From an obsession with being frugal, or earning more money, to obsessively checking your bank accounts, these anxious thoughts and behaviours can be debilitating. If so, they need to be taken seriously as anxiety disorders are real medical conditions.
Whether you find yourself engaging in these behaviours, or are looking to develop a more positive mindset towards money, here are healthier ways for you to cope with financial anxiety:
Manage your debt
- Studies have shown that people in debt have higher rates of mental health issues compared to those who are debt-free. Go through your debt to get a better understanding of them and develop a plan to pay them off. To avoid debt, put together a budget that covers your major expenses.
Automate important payments
- Missing payment due dates and having to pay a late fee can cause financial distress. If you’re able to pay these debts, bills and other obligations on time, automate them! For those you’re unsure of, set a reminder on your phone to prepare yourself for the due date.
Create a budget
- Being able to stick to the right budget will ensure that you live within your means. Budgeting will also help you track your spending and build your savings! Learn more about creating a budget from HeyAlfred here.
Track your spending
- End every week with a financial check-in, but don’t just look at your bank balance – go through your transactions and see how you can improve in the following week. Think of it as a financial self-care routine, which you can learn how to put together here.
Develop an emergency fund
- The COVID-19 crisis has made it crucial for all of us to have an emergency fund. These savings will help support us for a few months in case we fall sick or lose our jobs. Here’s how you can develop an emergency fund – it’s not too late to start.
- If your financial anxiety affects your day-to-day life, please seek mental health support. Other than therapy and counselling, you can reach out to a financial advisor for professional advice or to the human resources (HR) department at work for more information about your employee benefits.