If clichés are to be believed, money is not only the root of all evil, it also cannot buy you happiness. Yet money – and our attachment to material wealth – still dictates almost everything we do. It’s one of the reasons why we go to work (although it shouldn’t be the only one), and it’s how we afford to buy nice things and foreign holidays. It pays for the roof over your head, and the food on your plate. There is also the argument that money is a form of energetic exchange – after all, it is a means of placing value on things that others have created or provided, and it’s part of the reciprocal give-and-take relationship we have with other people in our society, or the rest of the world. 

But sometimes we can get carried away and veer off a financially sustainable track. It could be self-inflicted or tied to the state of our mental health, like oniomania, a compulsive shopping or spending habit that is a form of addiction. It could be a lack of maturity or self-discipline, or not enough education on fiscal responsibility – or even a high susceptibility to the endless advertisements and marketing strategies in today’s consumerist culture. Indeed, you could also fall into times of hardship by no fault of your own – be it a redundancy during times of economic distress (such as a global financial crisis or a pandemic), the death or major illness of a loved one that you unexpectedly become responsible for, or even a sanity-cleansing sabbatical to look after your mental health. Regardless of the cause, worries around our monetary stability can send us on an anxiety spiral, potentially leading to depression or even substance abuse. 

It need not be all gloom and doom, however, since there are ways to help you deal with your financial stress – not to mention coping mechanisms that can help you navigate your way out of your financial woe. And they don’t all have to involve adding an additional source of income (which isn’t always a possibility for everyone). 

First, tackle the stress. That can be as simple as starting to eat better, establishing a meditation practice, or if your anxiety levels call for it (and if your budget allows for it), seeing a therapist. Once you’re in a better place mentally and emotionally, you can set yourself on the path to better habits, with a more stress-friendly approach to money matters. Breaking your approach down into simple, clear steps can make an insurmountable goal feel a lot more attainable and a lot less overwhelming. Here are five ways to help you get a better grasp on the situation. 

Improve your financial well-being in Carol Glynn's short course: How to Master Your Money Mindset

 Identify the Issue 

Is there a specific repetitive outgoing cost that’s pushed you beyond your limits, or one particular splurge which has stretched your savings to non-existence? Are you aware of where your money usually goes each week, month, or year? It may not be easy to face the first time you do it, but calculating and writing this down – perhaps keeping a diary of everything you purchase, no matter how big or small – can give you a better picture of what your spending habits are… and help you identify where the problems are. Once you’ve made note of what’s causing your financial stress, you can start to look at ways of counteracting it. One trap people often fall into is to only pay the minimum amount due on credit cards, which will continue to accrue unwelcome interest charges without helping you be rid of that balance owed. If your credit card repayments are hanging over you and causing stress, it might be prudent to increase the repayment amount in an effort to not only save you money in the long run, but also help you actually reduce or pay off that debt over time. 

Understand Fundamental Money Matters

If you ever took business studies as a subject in school, you’ll understand the importance of balancing your ledger. If not, consider learning the fundamentals of budgeting. Listen to podcasts, read articles, watch tutorials; there’s an abundance of information out there to help you with your dearth of funds. And it all starts with one financial decision at a time. Don’t try to solve all your problems in one fell swoop if that’s an unattainable target. Simply take one outgoing, understand how that diminishing of money affects the rest of potential spending, and take it step by step from there. 

Make a Plan

Countries need one, businesses need one, and you need one: a budget. Create an expense-tracking spreadsheet that shows you where your money is currently being filtered to, or try using a secure and reliable app that helps you do the same. Consider which outgoings are utterly unnecessary, and which are an absolute priority. Better still, utilize budget calculating tools that can help you build an education fund, emergency fund, and retirement fund – or simply rework your currently-unsustainable (or non-existent) budget. With a basic knowledge of budgeting, you can create a debt repayment plan that will give you eyes on an end-date to exasperating expenses. And psychologically speaking, the very act of making a reasonable plan that suits you and your individual needs – rather than sweeping your problems under the rug, only for them to likely come back and bite you later – will already help to reduce your stress. You can think of it as a form of “proactive coping” – making a plan is a form of self-regulation and self-accountability from which you can regain a sense of responsibility and control. From there, try to think of exercising the discipline of executing and committing to that plan as a form of self-love and self-care, through which you are caring for yourself enough to actively look after your own needs. 

Avoid Temptation & Learn To Spend More Mindfully

Millennials have a reputation for scoffing at Boomers’ inference that the reason they can’t afford a home of their own is because they’re addicted to gourmet coffees and avocado-toast. It may be unfair to make such a sweeping judgment over an entire generation, but even on an individual basis, the sentiment isn’t completely unjust when it comes to budgeting. Someone with a smart and money-conscious budget will look for cheaper alternatives rather than easily giving into a “life is hard so treat yourself as often as you can, even for minor hardships or inconveniences” mentality. That’s not to say you shouldn’t treat yourself when it’s deserved – rewarding yourself from time to time is important – but it is equally important to distinguish which treats will provide a worthy ROI (return on investment) for your authentic joy and self-esteem, and which are a flash in the pan that wasn’t really justifiable if you were being honest with yourself.  Mindfulness can play a big role here: this state of being present and fully self-aware can also extend itself to our behavior, and mindful spending is a thoughtful way to be truthful with ourselves about what we want versus what we need.

Of all of the steps we can take to tackle our financial stress, this could be one of the most important, since rather than simply fixing our current situation, learning to spend mindfully will also help to change your relationship with money. Just like our relationship with people, the way we view, treat, and interact with our funds can be affected by our core value systems, our wounds and traumas, and our overall mindset. Ask yourself: what are my financial values? What is really important to me, and what do I genuinely value spending more on? What am I regularly purchasing that is not coming from a place of joy and satisfaction, but is perhaps attached to my emotional or mental state? For the latter, you may have to do some soul-searching to explore the root of the problem. By tackling that at its source, the spending – which in this case may be a symptom of a greater issue – may also help take care of itself. Question whether you have an abundance or a lack mentality when it comes to your money: a scarcity mindset towards our finances may exhibit itself through an inability to get off the hamster wheel of repaying debt (even when we may have better options available), having a very erratic or inconsistent commitment towards budgets, allowing bills and other responsibilities to pile up, being afraid to invest in genuinely good opportunities due to fear or saying “yes” to opportunities that aren’t actually right for you in the bigger picture due to fear that another won’t come along. It may involve constantly feeling behind or like you don’t have enough, or that you aren’t enough. If this is the case, working on improving your mindset towards money can change your relationship with your finances in leaps and bounds. 

On a practical everyday level, this can simply begin by taking stock of your emotions around each financial decision, so you can develop that self-awareness. Is that fancy morning coffee habit genuinely making you a lot happier? If you compared it with getting your coffee fix at home (bringing it to work in a thermos, with a homemade salad for lunch, perhaps), how much would it impact your mood and stress levels, both in the moment and in the longer run? Now do the same for your premium streaming subscription, or your penchant for ordering expensive takeout over cooking your own meals more often. Indulging in little luxuries are a wonderful and sometimes necessary way of adding joy to our day-to-day life (or perhaps exhibiting some self-care), but there will also likely be a number of them you can cut out. If you look after the pennies, the pounds will look after themselves.

Ask for Help

Seeking assistance with your finances – or your financial stress – doesn’t mean looking to borrow money from a friend, nor does it mean being enticed by loan sharks with incredibly high interest rates or other dangerous fine-print clauses. Instead, if you are really struggling with your finances, it may be time to seek the help of a professional, such as a financial expert, who can teach you to sustainably control your outgoings. If it’s the psychological aspect that is challenging you the most, then consider talking to a qualified therapist. This brings us back to point number one, where if you can first manage the stress, emotions, and source of the issue, the guidance of a trained specialist can help you retrace the steps above, until you’ve mastered your spending and cultivated healthy habits to maintain a better relationship with your finances moving forward.

Improve your financial well-being in Carol Glynn's short course: How to Master Your Money Mindset

All of the content on our website is thoroughly researched to ensure that the information shared is evidence-based. For more information, please visit the academic journals and other resources that influenced this article:

Financial Stress And Depression In Adults: A Systematic Review; Coping With Financial Worries; Feeling Anxious About Your Finances? Here’s What You Can Do To Calm Your Nerves; 10 Tips For Dealing With Financial Stress; Coping With Financial Uncertainty: A Resource Guide; The Relationship Of Financial Stress To Overall Stress And Satisfaction; The Real Consequences Of Financial Stress, The Effects of Unemployment and Economic Distress on Depression Symptoms.