Every day, there’s a new headline about how various things will be costing us more money.
Whether it’s rocketing interest rates, the cost of food, or the rising energy bills that, have not only risen once, but are set to increase again in the autumn.
As children and teenagers we’re often taught to plan ahead for the future – but with the current cost of living crisis, it’s becoming a weekly, even daily, struggle to get by.
Savings are being dipped into, pay queues are vanishing quicker than ever and it seems like money is just slipping through our fingers every month.
It’s a horrible feeling.
People are deeply concerned for their financial futures. And with wages not increasing at the same rate as inflation, there’s a feeling of being stuck in a hopeless situation.
‘Money worries can have a hugely negative impact on your emotional wellbeing, and your mental health can affect how well you manage your money – it’s a vicious cycle,’ explains Rowan Harding, a financial planner at Path Financial.
So what can you do if you’re feeling incredibly overwhelmed by it all? And what practical things can you do in the short-term to help?
Experts have shared some tips for dealing with financial worries – as well as various things you can try today, to feel more in control.
Acknowledge your feelings
Smriti Joshi, the lead psychologist at Wysa, stresses that anxiety and financial worry are both completely valid – and the first step is to acknowledge this.
He says: ‘Acknowledge that these are real worries and you’re not alone in experiencing these.
‘Not feeling alone will help with not adopting a victim mindset of “why me?” see them as real problems to be problem solved and not something completely out of your control or catastrophic, even if it feels like that in this moment.’
Talk about your concerns with someone else
‘Sometimes stress can make it hard for us to objectively evaluate our own situation, leading us to believe that there’s no light the end of the dark tunnel,’ explains Smriti.
But talking to a loved one, or even a professional, can really help.
‘If you are feeling stressed, anxious or apprehensive about your financial situation, share the mental load with a friend of family member,’ says psychologist Dawn Baxter.
‘Use the time to talk through any feelings that you may be having and then where possible try to create a step-by-step plan to help you become clearer about the situation.
‘In 90% of cases, just getting a plan on a page can really help you feel significantly better.’
Get information from valid sources
It’s always a good idea to be selective about the type of media you consume during periods of high stress or anxiety.
Smriti adds: ‘Choose a valid source of information on any news about price rises, inflation, any financial impact from pandemic or wars (or any other catastrophes) and reduce time on social media posts on these issues.
‘People with most well-meaning intentions can sometimes offer not-so-helpful advice or write things that can be triggering.’
Try to think practically and objectively
Dawn says: ‘With unprecedented situations like this, it’s important to try and view the situation objectively and to recognise the emotions that come up for us.
‘What we can end up doing is falling into a destructive negative spiral which becomes all-consuming, and this isn’t helpful to our emotional state.’
Media headlines, conversations with friends and family, and just observations from day-to-day life all have the ability to send us into this negative headspace – but we can protect ourselves by objectifying the situation.
Dawn adds: ‘It’s important with issues like this to take a step back and look at this from a distance to help you give yourself perspective on the situation.’
Practical things to try to feel more in control, according to experts:
Think about your money goals
Rowan says a good place to start is to think about your money goals.
You can do this by asking yourself the following questions: What do you need to achieve? And are you trying to manage your day-to-day expenses, pay off debt, or build an emergency fund?
‘Having clear goals – however large or small – will help give you the motivation to take charge of your money,’ she explains.
Organise your money
The next step is to get organised with your money.
Rowan says: ‘This can feel daunting, but it will really help you to get to grips of your financial situation. Get all of your important financial documents – bank statements, payslips, bills and receipts – in one place that you can access easily.
‘I’d also advise scheduling some “money time” – a set time each week when you sit down and deal with any money-related tasks, such as paying bills or checking your bank balance.’
Budget
Building a budget will give you more control over your money and help you to keep a track of your expenses, adds Rowan.
‘Start with your total income – minus deductions for taxes – then write down all the essential things you need to spend money on each month, such as rent, mortgage payments, fuel, energy bills, phone bills and food,’ she says.
‘There are lots of free budget planner apps and online tools that can help you with this.’
Deal with debts
Being in debt can be incredibly stressful and difficult, but it’s important not to ignore the situation and allow it to spiral out of control.
Rowan continues: ‘The sooner you handle it, the easier it will be to deal with. Set up a standing order to pay off your debts each month if you can afford to, but if you’re struggling, there is help available, such as the National Debtline, StepChange and Financial Wellness Group.’
Don’t be afraid to seek extra support
‘You might assume that you’re earning too much to claim benefits, or you might already be claiming them and not realise that there’s further support available,’ Rowan continues.
‘Whether it’s Universal Credit, Tax Credits, Carers Allowance or free school meals for your child, it’s well worth seeing what you’re entitled to.’
It could also be worth talking your energy supplier about anything they can do to help reduce the sting of rising household bills.
Rowan also points out there are government schemes, such as the Energy Bills Support Scheme and the cost-of-living payment, that you may be eligible for.
Getting help with food costs
‘If you’re struggling to put food on the table, charities such as The Trussell Trust, Bankuet and the Independent Food Aid Network can help you find food banks in your local area,’ explains Brean Horne, a personal finance expert at NerdWallet.
She adds: ‘It’s always worth checking to see if your child qualifies for free school meals which may help ease pressure on your food budget.’
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