How To Handle Money Anxiety

Do you ever wonder how to handle money anxiety?

A poor money situation is a common experience for a majority of people in the United States. In fact, a recent study says 69% of Americans are living paycheck to paycheck.

Even though the number has declined since 2019 (from 74%), that’s still more than two-thirds of Americans who say they would experience financial difficulties if their paychecks were delayed for a week.

I’d venture to bet that this type of tight living is causing anxiety in a lot of people. But what can you do about it?

If you’re experiencing money anxiety — or know someone who is — here are some tips that can help.

7 Steps To Rid Yourself of Stress About Money

As a single mom of four kids, I’ve become somewhat of an expert on money anxiety. I say that laughingly, but money anxiety is no joke.

Studies consistently find that money a predominant cause of stress in America. And it has been for many years.

Personally, I felt the most stress about money in my first year as a single mom. I’d been a stay-at-home mom, and suddenly I was faced with raising and supporting four kids on my own.

Most money anxiety comes from having an unstable money situation. Constantly worrying about whether or not you’ll be able to feed yourself and your family and keep a roof over your head takes a toll on mind and body.

Luckily, there are a number of things you can do to calm your fears about your money situation. We’ll take a look at both physical and psychological steps you can take to handle money anxiety.

1. Face Your Current Situation

The first key to overcoming money anxiety is to face the facts about your money situation. Sit down and write down how much money you have in banking and investments.

Then list your debt information: how much you owe each company and the amounts of your monthly payment and the interest rate.

Take a good, long look at the numbers and try to reflect on what got you there. Was it years of less-than-diligent money management? One or more personal crises?

It’s important to know how you got to where you are financially. By understanding your history, you can better learn how not to repeat it.

2. Accept Your Situation

It’s one thing to face the numbers; it’s another to accept them. Money anxiety often results from a string of money mistakes.

Unfortunately, we can’t go back and change the past. Try to accept the situation you’re in without beating yourself up. Stuff happens. We all make mistakes, and we all suffer hardships.

Own up to your situation and accept it — no matter what the cause. Acknowledge the mistakes you made that put your finances in their current state.

Also acknowledge things that happened to you that were out of your control. Accept that these instances occurred and that there’s nothing you can do to change them.

Most importantly, forgive yourself — and others — for the financial situation you’re currently in.

3. Make a Game Plan

Now that you’ve faced the facts and accepted your situation, it’s time to make a game plan to change things up. Ask yourself some questions:

  • Am I currently living on a budget? If not, why not?
  • Are there expenses I can cut?
  • Am I tracking my spending?

Personally, tracking my spending was the number one move I made to stop my money anxiety. Once I could see clearly where my money went each month, I felt more in control.

And more importantly, I could see where I was wasting money on things that weren’t really valuable to me, which made it easier to stop spending on those things.

Choose to take the time to make a game plan for your money. Create a monthly budget. Track your spending. Write down a list of your financial goals. Use a budgeting app to help you organize your finances.

As the old saying goes, “By failing to prepare, you are preparing to fail.” Stop preparing to fail with money because you’re unwilling to make a plan to manage it.

4. Take Extra Steps To Promote Change

Money anxiety can be subdued, but you’ve got to take a couple of steps to make that happen.

First, you’ve got to face and accept your situation, as I mentioned earlier in this article.

Second, you’ve got to work toward changing your situation so that you have no reason to be anxious about money.

In Step 3, I wrote about making a game plan: a budget. If you’re doing everything you can to ensure you’re living within the plan, and things are still tough, it’s time to consider additional steps.

For instance, you can start looking for ways to bring in extra income. You can pick up a second job. Or ask for overtime hours at work.

You can get a side hustle. Or you can work toward getting a promotion to a higher-paying job, whether in your company or outside of it.

What about selling items you have that you no longer use or need? Use the extra money you earn to accelerate the financial game plan you created in Step 3.

Maybe you aren't living paycheck-to-paycheck, but you still suffer from money anxiety. Bring in extra cash using one of the tips above and then put it toward debt, or sock it into your emergency savings, retirement funds, or other investments.

What other extra steps can you take to better your financial situation and calm your anxiety? Can you take an online personal finance class? How about reading personal finance books?

Money expert Clark Howard has written a variety of finance books that can expand your knowledge base about money.

And we have articles here at on hundreds of financial subjects. You can search at the top of every page of our site.

5. Track Your Progress

Changing your money situation in order to reduce anxiety is a tough task, especially if you’re working your way out of debt.

This is where tracking your progress can be very helpful. When you’re in the day-to-day grind of working and paying the bills, it’s easy to lose track of where you are and where you’re headed.

However, when you have a chart or graph that allows you to look back and see what progress you’ve made over the last six weeks, six months, or year, you’ll be able to see that you’ve truly made changes.

Maybe you’ve paid off several thousand dollars of debt. Or maybe you’ve increased your savings account by a large amount.

As you track your progress, acknowledge your successes and be sure to maintain a realistic view of how far you’ve come. In other words, be proud of the work you’ve done!

6. Get Support

Having a support system is another important step in reducing money anxiety. Find two or three people who:

  • Celebrate your successes with you
  • Encourage you to keep moving forward
  • Handle their own money in a way you want to emulate

Ask these people if they will act as support persons for you as you work to make your money situation better. Consider being accountable to them by sharing your progress and/or failures.

Be humble and willing to learn from their experiences, successes and even their mistakes.

7. Talk to Yourself

It’s easy to let fear take over when you’re struggling financially. But to truly overcome money anxiety, you’ve got to choose to be your own cheerleader.

It’s important to be honest as you talk yourself through money stress.

When successes come, give yourself a pat on the back. And when failures happen, take responsibility, forgive yourself and move on.

Also remember to remind yourself of your progress. Talk about how you’re better off now than you were six months ago. And remind yourself to keep going until your finances are where you want them to be.

Be the positive person who talks yourself up just like you’d talk up a friend going through a rough time. And don’t be afraid to celebrate your wins.

A Note About Money Anxiety in the Financially Stable

As I’ve talked and shared with thousands of people about money anxiety, I have come across a few people who have money anxiety even though their finances are stable.

In fact, I’ve met some people with millions of dollars in the bank who still live in fear about not having enough money.

This sometimes happens because of fears about money people developed as children. Maybe your parents were bad with money. Or maybe they went through some trying financial times that had a big impact on your feelings of safety and security.

Maybe you had your own financial traumas as a young adult and you’re afraid that you’ll repeat them.

These types of ingrained fears can lead to hoarding money and even idolizing it. You might even put saving money above the needs and happiness of yourself and/or your loved ones.

If this is the case with you, it’s important to understand that no amount of money will change your money anxiety.

Instead, you’ve got to get to the root of what’s causing your fear about money and change your perspective. This may take professional therapy.

If this sounds like you, I encourage you to begin your journey to healing by “letting go” of some of your money. Start giving money to charity or handing out small monetary gifts to your kids for no reason.

As you learn to let go of your money and see that you’re still financially sound, the healing can begin.

Final Thought

Money anxiety may be common, and it may be something you’ve lived with for years. Choose today to change that up.

Take the steps you need to take to be able to stop letting fear about money hinder your happiness. Instead, make the changes you need to make to gain control over your finances.

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