Everyone knows that keeping your finances in order is essential, but it is easy to let financial stress get the better of you. When you’re in the middle of a financial crisis, finding the resources you need to make it through the storm can be difficult. Luckily, we’re here to help. Here are four simple tips to help you make better financial choices and change your mindset around handling your finances.
1. Make becoming debt-free a priority
Not only is debt bad for your credit score, but the stress it adds to your mental health can create a ripple effect that affects your physical health, too. This year, commit to reducing your debt as a way to treat your physical and mental health better. Try using something like this multiple loan payoff calculator if you’ve got outstanding personal or student loans or research methods for tackling credit card debt in actionable ways.
2. Don’t beat yourself up if you make a mistake
No one is perfect when it comes to personal finance; it’s a skill that takes constant effort, even for those who practice good spending habits. It’s not the end of the world if you end up overspending, putting something on your credit card, or getting hit with an overdraft fee. The important part is what you do next. If you stumble with your finances, accept that you’ve made a mistake and commit to doing better next time. Don’t let yourself get into a mentality where it’s all or nothing with personal finance; we all make mistakes once in a while and aren’t perfect. Pick yourself up and move forward.
3. Make realistic financial goals
If you’ve ever recommitted to the same New Year’s Resolution to get out of debt, then you know how disappointing it can be when you feel like no progress was made. Instead of setting yourself up for failure, set smaller, more manageable financial goals. For example, if you’ve got $30,000 in outstanding debt but earn $50,000 a year and have $35,000 in yearly expenses, there won’t be enough money to get that $30k paid off in a year. Instead, look at your budget and make a more realistic goal that makes it easier to accomplish. It might not be as satisfying to get rid of $5,000 instead of $30,000, but every dollar counts, and that $5k is still better than $0.
4. Practice intentional spending
Intentional spending is the process of removing the ability to impulse buy. Too often, we’ll get ourselves further into debt and create more stress by buying things we later regret. To avoid getting into this cycle of “spend and regret,” simply make it more challenging to impulse buy. Delete e-commerce apps from your phone and remove any stored payment methods. Then make it a routine to put an hour between adding things into your shopping cart and checking out. By just adding those 60 minutes, you’re able to remove yourself from the temptation of impulsivity and consider whether or not this item is something you actually need.
The bottom line
These strategies can help you reduce the financial stress affecting your mental health. By taking the proper steps, you will not just be improving your financial situation, but you’ll be helping to ease some of the stress in your life as well.
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