A recent Bank of America/USA Today report found that many millennials are experiencing stress when it comes to personal finances. Roughly 84% of millennial survey respondents said they were confident in their ability to manage their finances, but 41% admitted to experiencing chronic stress when it comes to money matters. Some of their primary stresses were not being able to save enough for emergencies and overspending.
Does this sound like you? If you share some of the same money worries, there are a few things you can do to help alleviate the anxiety. All it takes is a few good financial habits to help you stay on the right path. Here are a few tips for managing financial stress.
1. Set financial goals
A certified financial planner can help you with setting and keeping financial goals. If you need help finding a planner, the Certified Financial Planner Board of Standards website is a good place to start your search. A financial professional will be able to assess your overall situation and help you identify blind spots that could use improvement.
“Our 2015 Advice Survey found that respondents who have met with an advisor are significantly more confident in their retirement savings plan when compared to those who have not (78% versus 43%). Typically, financial advice leads to positive actions. Our survey found that roughly one-third of respondents who have received professional financial advice report they increased the amount set aside in savings (36%), decreased spending (29%), monitored their savings more frequently (32%) and established a plan for paying off loans or managing debt (28%),” said TIAA-CREF Senior Managing Director Cathy McCabe.
2. Save for emergencies
Set aside some cash for a rainy day. Things may be going well for you now, but it’s important to be prepared for an unexpected life event. No one is immune to the financial impact of a layoff, divorce, or medical emergency.
“Try saving small to start. Even if you can only sock away $5 to $10 per week it will make it easier to pay for an emergency when it does come up. That little bit can add up faster than you think!” said financial expert Kelly Whalen.
3. Get a money buddy
The buddy system is powerful when it comes to following through on financial goals. If you find it hard to stick with your financial goals, seek out a buddy who can help you stay accountable. You may have a gym buddy or a laundry buddy, but a money buddy will be your most valuable asset. But make sure to seek a friend who is responsible with money and can show you how to follow suit.
4. Set boundaries
Have you become the family ATM? Does everyone look to you first when experiencing a financial hardship? Don’t feel obligated to lend money to everyone who asks. Make sure that your own finances are in order if you decided to lend. Also understand that you may not get your money back if you lend to a friend or family member.
5. Consider financial therapy
If you find that your financial stress has become unmanageable and it is affecting your daily activities, it’s time to seek therapy. A trained financial therapist may be able to help you get out of your rut and get your life closer to normal again.
“…A financial therapist is focused on enhancing financial well-being through the study of the emotional, behavioral, cognitive, relational, economic, and integrative aspects of financial health. The work brings together financial counseling and planning with personal counseling, marriage and family therapy, sociology, social work, and psychology,” financial therapist Amanda Clayman told The Cheat Sheet.
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