Have you felt financially stressed recently? You are not alone. Here is what causes financial stress and the best methods to tackle it and improve your personal finances.
The COVID-19 pandemic has been around for two years and financial support sent by the government at the beginning of this economic crisis is running out while many Americans still feel strapped for funds. Almost every person has been affected by the coronavirus pandemic that led to job losses and massive unemployment.
Job loss and temporary unemployment is another significant cause of financial stress. People who had a steady source of income suddenly became unemployed or faced lower income. Consumers weren’t ready to deal with such disruptions as many of them didn’t even have an emergency fund. Having no savings set aside for an emergency means that one day you can’t cope with a sudden financial shortfall and may need to take out a 1500 loan bad credit to cover immediate cash needs.
The CNBC+ Acorns Invest in You survey conducted by Momentive claims that 25 percent of Americans felt financially stressed all the time last year. This survey was performed on the web and 41% of 4,000 adults stated they felt occasional stress over money matters, while the remaining 34% said they rarely experienced financial stress last year. If you are among those who suffer from stress over your tight budget, keep on reading to find out what can be done to solve this issue.
Changes to Your Budget
Low-income households are those who are hit by financial stress the most. People with less monthly income or those who lost their jobs suffer from stress over personal finances – that’s nearly 60% of respondents. The changes to the budget should be made in order to overcome temporary financial issues and remain financially afloat.
Overspending is one of the reasons why people should start budgeting. You need to make smart monetary moves and serious changes to your attitude to personal finances. Spending less money each month is one of the top priorities if you want to have more funds left for debt repayment or your savings account. Many certified financial advisors recommend consumers prioritize their spending and leave the essential categories such as rent, utility bills, groceries, and medical costs until their finances become stable again.
Top Ways to Tackle Financial Stress
Financial challenges are faced by millions of American citizens today. Considering the present uncertain economic situation, shutdowns, and high unemployment rate, there is no doubt people feel financially stressed and need urgent help. Here are the best ways to manage financial stress during challenging times:
Remember that you can’t control or change everything. You need to prioritize the things you can control and change your attitude toward them. For instance, you may want to lower your grocery bill by making shopping lists and looking for discounts. Try to reduce utility bills by cutting down your cable TV, unnecessary subscriptions, or entertainment expenses. Focus on things that you can control and work your way toward minimizing monthly spending.
Find Options To Earn More
If you were laid off and temporarily lost your steady job, there is no need to panic. Think about new opportunities you can use in order to make more money. Having a tight budget now can become your advantage if you look for alternative ways and new income sources. Think about the things you can do and what hobbies you may turn into side gigs that will bring you cash. You may search for options on special web platforms and find a part-time position as a freelancer, a babysitter, a driver, a tutor, etc.
Pay Down Your Bills
The worst thing that you can do while your budget is tight is postpone paying your bills. You can also prioritize the bills you have. Utility bills, medical expenses, and loan payments are the essentials you can’t forget to pay off. If you don’t pay these monthly charges they will inevitably pile up and take you into a vicious debt cycle.
Even when your funds are tight you can try to save a bit. Do you have a savings plan? You need to have a plan to follow and remember to set some cash aside for your retirement as well. When you keep on saving some money each month you feel more secure and this sense of protection helps to release tension and relieve some of that financial stress. Choose a high-interest savings account at the local bank to maximize your savings.
Negotiate Your Debt Payments
You may also try to talk to your creditors about the debt burden and negotiate smaller interest rates. If you feel overwhelmed by financial stress, you can try to discuss your debt repayment plan and possible changes in fees that may help you repay the whole amount faster.
Financial stress is what millions of people experience today. Unemployment, rising inflation, and high prices have become common reasons for stress over personal finances. Many consumers don’t know how to deal with this stress and make mistakes or even become deep in debt.
This is not the best way out as your aim is to cope with the current stress and find the most suitable solutions. People who want to eliminate this stress need to follow these tips and try to manage their funds in order to overcome temporary disruptions and solve current money issues without getting into debt.