If you’re stressed out because of money, it’s okay. You’re not alone. Studies have shown that the average person experiences 4 stressful life events each year. Those could include ending a marriage, not being able to provide for kids or being over-indebted. These are all very stressful experiences. The study found that money was the main driver for being stressed out. How do you deal with financial stress when things just aren’t going your way?
The short answer is to fight financial stress head-on.
The average person deals with stress in one of two ways. Either fight or flight.
We all have our ways of dealing with small daily stressors. Like to push harder at the gym, meditation or even pouring another glass of Merlot.
Although these tactics can help as daily stress relief, they’re not sustainable. They only provide us with short-term stress relief.
If you’re dealing with financial stress like having credit card debt, being unable to provide for your children or not having a financial plan – the flight tactic simply won’t work.
For example, Maria, a single mother with 3 kids, is being pressured by creditors to pay off her debt. Her current income does not allow her to make all her debt repayments and pay for monthly expenses. . . resulting in financial stress.
One of her biggest fears is not being able to provide for her kids. This only fuels her stress even further.
Maria does what most people do, she thinks that her financial situation will eventually change. Maria deals with her financial stress by making minimum debt repayments and using her credit card whenever she needs to.
But the truth is, she’s not dealing with her stress head-on. She’s avoiding it (flight tactic).
She should be fighting her financial situation head-on.
That means she’s actively trying to change her financial situation.
Actively making a difference in your financial situation will reduce your stress and increase your mental health.
How do you deal with financial stress head-on?
Let’s be honest, fighting financial stress sucks!
But it’s time you start dealing with your financial stress. Start taking control of your financial situation and live a healthier life.
Assess your situation
Before you can start your attack, you need to know what you’re attacking and where you’ll be attacking it.
Start by taking an inventory of all your debt and monthly expenses.
Dealing with financial stress is one of the most challenging things to overcome. Taking an inventory will help you understand your financial situation in its entirety.
Make a list of all your debt accounts and their minimum repayments.
Then make a list of all your monthly expenses, this includes child support, groceries, transport, rent/housing etc.
Now that you know what you’re dealing with, you can come up with a plan.
Plan your attack
Fighting your financial situation head-on means you need a money management plan in place.
Create a spending plan.
Creating a spending plan will help you gain control over your financial situation.
The purpose of a spending plan is to help you make all your payments on time, every time.
Being in control of your financial situation is great for financial stress relief.
How does it work?
Write down your take-home income. This is your total salary minus tax. Some companies deduct this from your salary on your behalf.
Your income amount also includes any side hustle money you’re making.
Once you have your total income amount, start deducting your expenses from your income.
Your debt comes first. Paying off ALL your debt is your number 1 priority right now.
Once you know that your debt repayments are covered, move on to your monthly expenses.
Now deduct all your monthly expenses from what’s left of your monthly income.
This is a very crucial part of your financial recovery. You’ll start seeing what you actually can afford.
Cut out any unnecessary payments you may have. This includes groceries, rent/housing, travel, etc.
Making these sacrifices will be one of the most difficult decisions you’ll have to make. But you’ll be healthily dealing with finical stress.
Now that you know exactly what you’ll be spending your money on, it’s time to fight your debt head-on.
Pay off your debt
When we say, “pay off your debt” we mean “pay off ALL your debt”.
Debt is the number one reason why we’re dealing with financial stress. So getting out of debt will be a huge step forward.
Image a life where you don’t have to choose between paying for child support and credit card debt.
Use the debt snowball method to help you get out of debt.
How does that work?
Start by listing all your debt from the lowest account tightest account. And write down the minimum repayment amounts next to each account.
Pay the minimum amounts on all the accounts while throwing as much money as possible towards the smallest account.
Once that account has been settled move on to the next account. Once that account has been settled move to the next one. Keep doing this until you’ve reached your highest debt account and paid off ALL your debt.
The single most important thing to remember when using the snowball method is that it’s not the math that makes this method successful it’s your behaviour.
You have to change your behaviour and deal with financial stress head-on.
You need help
You’ve taken an inventory of all your debt and monthly expenses, and you’ve given the debt snowball method a shot. But you don’t see any results, you may be over-indebted.
If this is the case, you need professional help.
You are living beyond your means, which means you can’t afford all your debt and monthly expenses.
Your financial stress will keep increasing unless you sort it out.
We have a solution for you.
If you’re dealing with financial stress because you’re struggling to pay debt repayments and monthly expenses, debt counselling is your solution.
When you sign up for debt counselling your monthly debt repayments will be reduced, which is huge financial stress relief.
Your debt counsellor, like Debt Rescue, will renegotiate a new repayment plan with all your creditors. Which means you’ll be paying less towards debt repayments every month.
How would debt counselling help Maria and her 3 kids?
Let’s assume that Maria has R200 000 debt, but she can’t afford to make all her debt repayments while paying for all her monthly expenses.
Naturally, all her creditors are harassing her to settle the debt. But she needs to think about her kids, she has to pay school fees, groceries, transport fees etc.
If Maria signed up for debt counselling she would be legally protected from her creditors. That means her car is safe and she doesn’t have to stress about her kids missing school anymore.
Creditors also won’t harass her anymore. Her debt counsellor will have to deal with her creditors on her behalf.
This will reduce Maria’s stress and allow her to focus on her family.
Maria will only have to make one single monthly instalment to her debt counsellor who will then allocate debt repayments on her behalf.
The debt counselling process will reduce a lot of the financial stress Maria has been dealing with. All she needs to worry about is making one single monthly payment to Debt Rescue, her trusted debt counsellor.
If you need financial help contact us today. We’ll help you reduce your monthly debt instalments, protect you from legal action and best of all, we’ll reduce your financial stress.
Join us today and enjoy and happier, stress-free you.