The money emotion…

Numerous studies have been undertaken to delve into what it is that causes stress and anxiety for Australians and for many years running, money and finances has come out on top. The main reason for this emotional relationship is because money is often tied to our perceptions of happiness.

Many people often think that if they could get a higher paying job or if they had more money, they would be free of stress, anxiety, or depression. However, in working with a lot of different people, I’ve seen that having more money doesn’t necessarily mean having less stress. Whether you’re worried about paying rent or paying a mortgage, finances can weigh on your mind and affect both your mental and physical health.

How does money affect our overall well-being?

Recent studies have shown that over 16% of Australians have skipped going to the doctor when they needed health care because of financial concerns and about a third of adults say that money is a major source of conflict in their relationships. The average household with any kind of debt owes more than $250,000, including mortgages. Having debt can cause frustration and self-doubt, especially if you are working hard to pay it off whilst also having to balance other obligations as well. Many things related to money are also out of our control, like the rising cost of housing and healthcare. When you feel out of control, it can lead to making decisions out of character and lead to many health issues including anxiety and depression.

What can I do to alleviate the stress from financial matters?

Understand your own relationship with money. Are you a spender, or are you a saver? For many people, you learn this through your parents. Often the habits parents have with money can, and will influence their kids, as well as this, those close to you such as your partner might also influence your financial habits as well. If you have children, teaching them good habits early on like budgeting, saving, and learning money management can help them in their future.

If you have a partner, come to an understanding and compromise together on what works for you. It’s important to be on the same page and have an open dialogue with one another and understand your differences. For example, if one of you is used to spending and one of you is used to saving, you can make a plan to where some of the money in your budget is designated for them to spend, and together you can agree upon how much you want to save as a family. It also helps to revisit the budget and plan as priorities change over time, and both people feel they are working toward the same goal together.

Plan. A lot of times we make purchases in the moment, which is often an emotionally charged decision. However, many of these purchases can lead to buyer’s remorse, which is the feeling of regret that occurs later. This feeling may be due to the fear of having made the wrong choice, guilt over extravagance, or suspicion that you overpaid. When you make a plan on the large purchases that you want to make whether it be a new car, house, purse or computer, it will help you avoid making emotionally charged decisions.

Be prepared for different things that can happen in the future. One way to alleviate potential stress is to have money set aside in the case of an emergency. If you have a partner, it may be helpful to sit down and discuss potential situations you may encounter together. Some questions to consider could be: “What if I lose my job? What if you lose your job?” If you are young, it is also never too early to put money aside for retirement. It’s important to have a plan in place that when situations do arise, so you don’t find yourself in a situation where you feel your head is just barely above water.

If you’re dealing with financial troubles, speak to a financial planner. Many people tend to be embarrassed and want to manage their financial troubles on their own but relying upon others can help ease the burden you may be feeling. A financial planner may be able to help you figure out some solutions, put your mind at ease and talk you through worrying times.