If you ask people what they commonly worry about, most will say money. It’s a basic fact of life that everything costs money, so when we are short on cash, it’s only natural to feel stressed. However, you must not let financial anxiety ruin your life. So today, Know Where 2 Invest offers some tips to help you solve your money issues and reduce stress along the way.
The Issue With Money
Although we know that we shouldn’t always prioritize money, the fact remains that we need it in order to keep a roof over our heads and to feed our family. Prices can always fluctuate, and it can be hard to tell if you will make enough to do what you need. When we think that we may be short on funds, we get stressed. Even worse than that, if you consume yourself with how much money other people have, then that anxiety can increase.
We get upset when we feel like we don’t have control over our own life, and if that situation is not resolved, then the mental issues can turn to physical issues. For example, if you can’t sleep at night because of a lack of funds, then your immune system doesn’t have time to recover so you may get sick easier. Needless to say, you need to work on your finances so you aren’t so worried all the time.
Prioritize Self-Care
Since your mind and body is the priority, your first step is to get your health under control. In addition to getting enough rest, you’ll also want to exercise when you can because the activity can take your mind off of things and help you relax. You should also spend some time doing things you enjoy, like hiking or completing puzzles, and you’ll feel better as you get lost in your hobbies.
Create a Budget
Whether your goal is to start a business or buy a house, the first step to managing your financial situation is to create a budget. You need to account for every dollar you have coming in and also every recurring expense and see where you are at the end of the month. If you are short then you may need to cut some of the unnecessary expenses, such as that coffee run every day or the streaming service that you never watch.
If you have a goal with a specific dollar amount attached to it, use that as a guide for your budget. For example, if you would like to buy a house in the next 12-16 months, use an online mortgage calculator to estimate mortgage payment, and try to budget for that amount now even if it’s more than your current rent. You can also use that amount to figure out your future home cost and create a savings plan for 20% of that amount.
Think About Retirement Savings
When it comes to retirement savings, it’s important to start early and contribute as much as possible. The earlier you start saving, the longer your money has to grow. And the more you contribute, the more money you’ll have in retirement. Retirement savings are important because they provide a source of income that you can’t outlive. Social Security will only replace a portion of your income, so it’s important to have other sources of income to cover your costs in retirement. Retirement savings can also help you keep up with inflation and maintain your lifestyle in retirement; with the rising cost of healthcare and other costs, it’s important to have a nest egg that will keep up with inflation. Finally, retirement savings can give you peace of mind in retirement. Knowing that you have a cushion of savings to cover unexpected expenses can help you relax and enjoy your golden years.
Get a Side Hustle
If you cut your unnecessary expenses but you still don’t have enough funds to relieve financial stress, then you may need to consider a side hustle. There are many tasks that you can do in your spare time including freelance writing, driving for a delivery service, online tutoring, and more.
Another option is to start your own business. If you are short on funds, then you may be able to get a grant from the Small Business Administration so you can get your business off of the ground. You can also make things easier by forming a limited liability company. An LLC has many advantages including less paperwork and tax advantages. Keep in mind that every state has its own legal guidelines, so check the rules in your state before moving ahead.
Talk to a Business Professional
Another option is to reach out to a financial expert or an accountant who can look at your situation and make recommendations for how you can improve. Investing can be a great way to reach your financial goals, but knowing what to invest and when can be intimidating. Investing can be especially challenging if you don’t have the recommended 3 to 6 months of income in your emergency fund. But there are ways that you can invest with your current financial situation. Robert Sadler, CFA, wants to show you how. Visit Know Where 2 Invest to start your investment journey!
Becoming financially stable can be challenging, but it is possible. With a good budget, estimates of future spending, and professional guidance, you can get your finances in order and reduce some of your daily stress.
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