How to Cope with Financial Stress

How to Cope with Financial Stress

By: Oscar Cordoba, External Affairs Specialist, Affinity Federal Credit Union

Finances continue to drive feelings of stress among Americans, and according to a recent survey from Mint, a whopping 66% of Americans experience financial stress several times a year. What’s more is the survey also found 28% of people ignore that stress. 

Financial stress can come in many forms – from everyday stressors like budgeting to more significant concerns like sudden financial disasters and unexpected events. Dealing with financial hardships can take a toll on anyone and includes both physical and emotional implications. How you manage those symptoms determines your path to a better financial state.

Grandpa and Granddaughter paying bills with credit card

A 3-Step Action Plan
It’s important to take immediate action when confronting financial stress. We recommend these three initial steps: 

1.  Take a step back: When navigating a personal financial hardship, be sure to take a step back and look at how your money is being spent across your budget. You should determine what spending is important, such as food, housing and childcare, what is less-vital, including entertainment or leisure activities, and anything that can be changed or adjusted, like renegotiating your cell phone bill or auditing your online subscriptions.

2.  Keep your budget in check, including savings: Maintaining a balanced budget is another key step to relieving stress on your wallet. Reeling in unnecessary spending by keeping tabs on how you spend your money is an important starting point. Creating an emergency fund with cash savings is one of the best ways to achieve peace of mind.

3.  Proactively seek outside help: To address your financial stress, it’s pivotal to seek help and know where to find it. Affinity Federal Credit Union offers various resources, free of charge, about managing your debt, as well as counseling services to help you set up budget and payment plans. 

Looking Ahead to the Future
While taking the right steps to achieve financial wellness, it’s likely you will still be dealing with debt, whether it’s from student loans or credit cards, which takes a toll on your credit rating. There are free credit monitoring services available that allow you to track your rating, such as Credit Karma, which can affect your ability to make important future purchases on things like vehicles and a home. There are also ways to consolidate and eventually overcome your debt by taking out certain loans. It’s important to seek advice from a branch representative or financial coach before doing so. 

While working to relieve financial stress and setting yourself up for success, it’s important to consider long-term planning, too. Whether you are retiring in four years or 40 years, planning for both the short- and long-term is crucial. There are a variety of programs available to invest for your future, whether it’s an interest-yielding savings account or investment accounts like a Roth IRA. Affinity has many options available to assist you.

With a stress-free budget in place, you can prioritize your personal wellbeing, like planning for doctors’ visits and seeking out healthier food options, as well as your emotional wellbeing in order to manage your stress levels. Let Affinity Federal Credit Union help you with your financial wellbeing. Learn more about becoming a member here.

This information is for informational purposes only and is intended to provide general guidance and does not constitute legal, tax, or financial advice. Each person’s circumstances are different and may not apply to the specific information provided. You should seek the advice of a financial professional, tax consultant, and/or legal counsel to discuss your specific needs before making any financial or other commitments.