Most of us will face financial stress at some point in our lives. There is a multitude of reasons why money worries might happen, from a life-changing event such as divorce, through to general cost of living pressures.
It’s a situation that can really impact anyone: You don’t need to be rich or poor to be affected. I recently read a study from America, which revealed that 62% of Americans feel stressed about money. The numbers are similar here.
The impact of financial hardship goes way beyond finance alone. The cost to your health, both physical and mental, can also cause a real challenge.
Health impacts cannot be ignored
The impact of financial stress on your health can be far reaching. Plenty of studies have found that financial stress can have long lasting consequences not only for your mental health and wellbeing but for your physical health as well.
For example, there’s been significant research across many Western countries looking at the impact of financial stress on our physical health. Studies have shown that those under financial stress can see increased rates of life threatening conditions, such as cardiovascular disease. There are also studies and reports demonstrating that worrying about money can lead to other serious health conditions, such as insomnia. However you look at it, it’s clear that stressing about money is detrimental to our physical health.
The mental toll can also be devastating. Financial stress is one of the leading causes of mental health problems, including depression and anxiety for Australians. The toll on society, from the economy to our health funding, is huge. Mental health is an area that we as a nation are really starting to focus on, and as someone who deals with financial matters, I can understand its importance.
There have been studies that show how financial stress can alter our decision-making capability. One such study, reported in the journal Science, tested the response of people to receiving a car repair bill, the first being a rather small bill, the second a larger one. The decision-making capabilities of those with the larger bill were significantly reduced under the stress of paying such a large amount.
It’s an issue that is affecting at least 1 in 3 Australians as I write this. While it may be a challenge, there are some strategies that can help you mitigate or even avoid the impact of worrying about money on your general health.
Tips to avoid the stress
Working in the finance industry, it’s our job to help our clients avoid these situations. Alleviating the stress of managing your finances across every area of your life is something we’re passionate about.
There are a number of practical tips I can suggest to help you stay on top of your finances.
- Know where you’re spending your money: It may sound obvious but for many, just taking the time to understand where they’re spending their money is the first step to a better financial future. It’s not uncommon for people to live pay check to pay check and while that’s something we would advise against, if you don’t know where your money is going, finding out is the first part of solving the problem.
- Identify your finance goals and prioritise them:Take the time to work out your financial goals. It will help to have them written down. The next part is to prioritise them: If you have goals make sure you actually set out to achieve them.
- Don’t be afraid to discuss money:For couples, don’t be afraid to discuss your financial situation and what you want to achieve. If you’re single, talk through your finances with a trusted friend or family member. Sometimes the simple act of discussing it will help alleviate the pressure.
- Have a system that helps you stick to your spending goals:Sticking to your budget is crucial. There are many systems you can employ, whether it be working with an adviser or simply going it alone. For younger generations, using a technology-based program is an excellent starting point to good financial health.
- Talk to a financial professional:At the end of the day, financial advisers, like our team at Apt Wealth, want to help you live for today while planning for tomorrow. If you’re struggling or stressed about money, it’s worth taking a look at getting professional help from your adviser.
General Advice warning
The information provided in this blog does not constitute ﬁnancial product advice. The information is of a general nature only and does not take into account your individual objectives, ﬁnancial situation or needs. It should not be used, relied upon, or treated as a substitute for speciﬁc professional advice. Apt Wealth Partners (AFSL 436121 ABN 49 159 583 847) recommends that you obtain professional advice before making any decision in relation to your particular requirements or circumstances.