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October 27, 2020
Everyone worries about money from time to time, but financial anxiety is different. Financial anxiety is an obsessive fear of things related to money that can often be debilitating.
Financial anxiety can be triggered by any number of things, not just a lack of money. Those who suffer from financial anxiety are continually worrying about bills and might be afraid to look at their bank account or cope with anything to do with personal finances. And like other forms of anxiety, financial anxiety is unhealthy. It can have an impact on your physical health causing insomnia, loss of appetite, or an inability to focus.
Financial Anxiety Is a Side Effect of COVID-19
If you suffer from financial anxiety, you are not alone. With the economic environment that has accompanied the coronavirus outbreak, more Americans are having to learn to cope with financial anxiety.
According to a survey by the National Endowment for Financial Education, nine out of 10 Americans are experiencing financial stress due to the pandemic. A Pew Research study shows that one in five Americans are having a physical reaction to the stress brought on by the COVID-19 crisis, including 30 percent who indicate they are experiencing a high degree of financial stress.
It’s only natural that financial hardship and loss of income will create worry. When that worry escalates to obsession, it can become a true anxiety disorder.
Watch for Symptoms of Financial Anxiety
There are many symptoms related to financial anxiety disorder. Some of them seem obvious, while others may be surprising. Here are just a few:
- Overspending: You would think that money worries would cause you to save your money, but shopping provides temporary relief from money anxieties. It becomes a vicious cycle where you keep spending to get relief, which makes the problem worse.
- Hoarding: Overspending can lead to hoarding; taking comfort in material items to relieve the anxiety from money challenges.
- Fear of spending: The other side of hoarding is being frugal beyond reason. Obsessive saving could prevent you from enjoying vacations or living in a comfortable home. It can also lead to avoiding home repairs and healthcare. People who overwork or work obsessively to earn more may also suffer from this type of anxiety.
- Uncontrollable finances: People with financial anxiety often are uncomfortable accumulating wealth. This can make it difficult to budget or prioritize household spending, and it can have a disastrous impact on retirement planning.
- Depression: Feeling depressed about the world around you can stem from a financial anxiety disorder.
- Obsessive behavior: Money anxiety can cause obsessive behavior as well, such as an inability to sleep or continually checking your online bank account.
These are just some of the symptoms, but there are ways you can tackle financial anxiety head-on.
Dealing with Financial Anxiety
Rather than remaining frozen in fear, consider ways you can alleviate financial stress and take control of your personal finances. Here are some suggestions to help you cope with financial anxiety:
- Schedule a money check-in: Set a financial goal for yourself to save a set amount by a specific date. Then start putting money aside.
- Create a household budget: Putting your income and expenses on paper will show you exactly where your money is going so you can take control of your spending.
- Manage your debt: Debt is one of the biggest factors that creates financial stress. Having a financial plan can help you avoid debt. If you are carrying debt, developing a strategy to pay it down will help put you in control of your debt.
- Create an emergency fund: Having an emergency fund can give you peace of mind because you know you have enough money set aside to pay your bills if you become sick or lose your job.
- Discard financial shame: Comparing your lifestyle or spending to others, especially on social media, only feeds money anxieties. Spending and accumulating wealth is not a contest.
- Practice mindfulness: How do you physically react to things associated with money? If your heart rate spikes, you begin perspiring or your mind starts racing. Try to relax with deep breathing exercises. You also can try to restructure your thinking by reminding yourself that there are things you cannot control.
With the help of 1st United Credit Union, you can take control of your finances. We have financial advisors and counselors available to help you. We also offer a wide range of financial tools that will make managing money easier. Here are some ways you can get started:
- Start with a savings account. No matter what your financial situation is, you can always find money to put aside. Saving can help you build your emergency fund as well as prepare you for retirement.
- Use online money management tools. These tools make it easier to set and keep goals, track spending, automate savings, and stick to a household budget.
The more you know about how to manage your money, the more control you will have over your finances. Feeling in control of your money will alleviate stress.
Talk to a 1st United service specialist about opening a checking account and setting up your online money management tools. Members can also get support from a professional financial counselor who can provide you with a personalized financial strategy. With a little help, you can better handle your finances and, hopefully, alleviate financial anxiety before it takes control of you.