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Health & Family

5 Ways to Deal With Financial Stress

woman reviewing financial statements- thumbnail

What is the biggest cause of stress to Americans?


That’s according to a recent study by the American Psychological Association (APA), which found 64% of Americans saying financial worries are a significant source of stress. To put it in context, the survey found that just 46% of Americans listed health concerns as a major stressor.

Another study by the Statistic Brain Research Institute found money as the second biggest cause of stress in the U.S., behind only job pressure, and ahead of such things as health, relationships and sleep deprivation.

However, this doesn’t mean there aren’t positive ways to deal with financial stress. As financial commentator Dave Ramsey once said, “I believe that through knowledge and discipline, financial peace is possible for all of us.”

Ways to Relieve Financial Stress

1. Save More Money

Creating a budget and an emergency fund are the top two strategies listed by

These are the kind of things that sound simple, but can be difficult to pull off.

Yes, you can create an amazing budget spreadsheet.

Or start building an emergency fund.

But to do those things you may have to pay off debt first.

It’s sometimes easier said than done, and the daily grind of life can get in the way: your car breaks down, you don’t get the raise you were expecting, you miscalculated your home remodel costs, medical bills popped up, kids needed money for school, and the list could go on and on.

So yes, having extra money on hand could help with financial stress. And it’s probably a good idea to put money away in a savings account whenever you have extra. But it’s not necessarily the only way or the easiest way.

2. Forgive Yourself

There’s a term in psychology called “avoidance coping” and it can lead to more stress in your life.

Dr. Alice Boyes writes in Psychology Today that this method of coping can lead to a tendency to stop working on a goal, feelings of awkwardness and delaying the start of a task you don’t know how you’re going to finish.

When it comes to dealing with stress over money, it’s not always just a matter of dollars and cents. It’s possible you feel bad about your situation, and that feeling could lead to inaction.

As the research at the beginning of the article suggests, you’re not alone. Many people feel stressed about money and their financial situation.

Part of the process of dealing with it might be not beating yourself up and understanding that it’s normal.

In a Harvard Business Review article on ways in which successful people defeat stress, the No. 1 reason given is to have self-compassion, meaning you don’t have to be hard on yourself to achieve your goals and be less anxious.

3. Reach Out for Help

You don’t have to take on all your financial stress by yourself.

Non-profit organizations such as the National Foundation for Credit Counseling can be a good place to start.

They offer assistance from trained financial advocates who can work with you on issues relating to credit and debt, housing, mortgages, student loans and general financial education.

It may also help to talk over your money difficulties with family, friends or other support networks. The American Psychological Association suggests that social and emotional support can be very important when dealing with stress.

4. Simplify Your Debt

Getting rid of debt entirely may not be realistic, at least not right away.

What you can do fairly easily and quickly is consolidate debt. Whether it’s credit cards or medical bills, sometimes it’s hard to manage not just the amount you owe, but the administrative work of keeping track of when bills are due and how much money you’ll have coming in at that time.

woman tries to manage her debt

Debt consolidation allows you to put all those obligations into one monthly payment. From there you know exactly how much you’ll owe, on what day, and how long it will take to pay it off. Plus, the interest rate is typically fixed, and could be lower than the interest you are paying on your bills now.

This predictability may be helpful in dealing with financial stress, as some research suggests having too many decisions to make – i.e., how to prioritize a number of different debt bills – can create additional mental tension.

5. Use Relaxation Techniques

Not every attempt at getting rid of financial stress has to be a rigorous exercise in bookkeeping. According to WebMD, there are a number of ways to relieve stress that anyone can do for free.

Something as easy as deep breathing can slow your heart rate and lower blood pressure. A warm wash cloth on your neck and shoulders for 10 minutes could help you decompress. And even just a good laugh is known to lower stress hormones and endorphins that improve your state of mind.

Meanwhile, common activities like walking and listening to music have the ability to reduce anxiety and depression.

More Than a Numbers Game

Some might assume that just having more money would decrease financial stress. However, a UBS study points out that even millionaires feel money-related pressures.

Sure, it’s important to get control of your spending, saving and debt. But it’s not the whole story.

Money can affect people in ways both psychological and mathematical. It can both get in the way of your dreams and help you pursue them.

It’s a part of so many aspects of life, it’s no surprise how common it is for people to be stressed out about their finances.

Hopefully the techniques above help you balance that tension with financial peace.