Do you ever find yourself freaking out about the prospect of repaying your student loans? Or maybe about how little you’ve saved? You aren’t alone.
Money has been the top stressor in the U.S. since 2007, according to a survey by the American Psychological Association. But it’s especially bad for Millennials. In fact, 63% of Millennials worry about money at least once a week, and 6% worry about money on an hourly basis, according to a recent study.
To some extent, the extra stress makes sense. Millennials are early in their careers and just finding their professional footing and starting to make important decision – marriage, children, mortgages, etc. But more than 1 in 20 Millennials worry about money HOURLY!?! That seems excessive.
To help you manage your stress about money, we’ve put together 5 tips and tricks.
1. Figure Out Where You Stand
First thing’s first – figure out where you stand. It’s easy to avoid thinking about something that makes you anxious. But some of your anxiety probably comes from a fear of the unknown.
Start by tracking your spending/income and adding up your savings/debt. Regardless of your findings, you’ll be better off. If you are doing just fine, then knowing as much will make you feel better. If you’re in a financial hole, you can start developing strategies for dealing with it.
You should also consider jotting down what’s nagging you about money. Research suggests that writing about your thoughts and feelings can help reduce stress, overcome difficulties, stay positive, and organize your thinking.
2. Identify Your Financial Goals
Now that you know where you are, it’s time to figure out where you want to be – i.e., your goals. We suggest you start by identifying 3 big financial goals you want to accomplish in the next 1-2 years.
Maybe it’s paying down $5,000 in debt, building a 3-month emergency fund, and buying your first pot-bellied pig. (Umm, great goals btw.) Whatever you pick, select goals that are: (1) specific – planning to “save more money” isn’t good enough; (2) attainable – setting impossible goals will only lead to discouragement when you inevitably miss the mark; (3) reasonable – you shouldn’t be saving for a new Tesla when you have $75,000 in debt; and (4) fun – include at least one fun goal to help you stay motivated.
3. Create A Plan To Achieve Your Goals
Okay. You know where you are and where you want to be. What’s next? You guessed it – a plan to get there (translation: a budget). With a plan in place, you’ll feel more in control of your future and as a result, less stressed out.
Our favorite budget is the 50/30/20 rule: spend 50% of your take-home pay on needs, 30% on wants, and 20% on savings/paying off debt. “Needs” are things like housing, transportation, and groceries. “Wants” are the fun stuff – eating out, vacation, Nicholas cage throw pillows, etc. “Savings/paying off debt” is mostly self-explanatory, but should include an emergency fund.
4. Minimize Social Media
We get it. The cat videos. The Ken Bone memes. Social media can be great. But it’s also an easy way to feel anxious about money. That’s because people tend to share stuff on social media that exaggerates their lifestyle – photos of lavish vacations, fancy restaurants, and wild nights out. You’re left comparing your lifestyle to an overinflated representation of everyone else’s, which brings envy and stress.
In fact, 2/3 of Millennials say that they compare their lifestyle to others due to social media and 24% of Millennials feel pressure to keep up with the spending habits of their friends, according to a recent TD Ameritrade study. To avoid trying to keep up with the Joneses, you should minimize your social media time. Doing so may also help you feel happier, generally – studies show that the more you use social media, the more likely you are to be depressed.
5. Maximize Friends And Family
When you’re stressed about money, try talking to your friends and family. They can help you navigate tricky financial issues and stay focused on the positive. Also, research shows that people have lower stress levels when they have someone to ask for emotional support. If family and friends don’t fit the bill, you can always contact a financial therapist or counselor to talk it out.
Likewise, if you’re in a relationship, you should make every effort to talk to your partner about money. Studies suggest that the more you and your partner communicate about money, the more likely you are to be happy. In a recent study by TD Bank, for example, couples who discussed money at least once a week reported being happy more often (78% of the time) than those who discussed money less than every few months (50%). In short: talk more, stress less.