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9 Smart Ways to Manage Financial Stress in 2018

9 Smart Ways to Manage Financial Stress in 2018

Financial stress is often caused by money mismanagement from previous years. Feeling financially stressed is not an uncommon problem but regardless, to be rid of it you will need to deal with the underlying issues. With proper financial planning, you can keep your financial stress at bay. Check out these nine financial stress management tips.

1.Use an automatic savings account

An automatic savings account lets you transfer money from your payroll account into your savings account. It is a very convenient way to transfer money and it means you can save first before spending. You can set up an automatic transfer every time you receive your pay check from your employer and your desired amount will then be transferred automatically into a savings account.

2. Stop impulse shopping

Impulse shopping can really ruin your finances and can cause great financial stress if it gets seriously out of control. To avoid this, try leaving your credit cards at home and only bring the amount of cash you’ll need. If you think that you’re truly getting a good deal and want to buy, try to impose a 24-hour waiting time before you make the purchase. This will let you consider if the item you want to buy is really a need or just a want.

3. Download a money management app

Financial planning involves knowing where your money goes. If you have problems tracking your spending habits, you can download a money management app that’ll let you budget and track your expenditures.

4. Reduce luxury expenses

If you’ve already identified your spending habits, pay attention to things that you can cut down on. Usually these are luxuries. They can be any product or service that you don’t really need. For instance, if you don’t use your cable TV that much since you started subscribing to an internet / on-demand TV service, you might be able to cancel your cable TV plan. If you frequent pricey coffee shops or if you lunch out at work all the time, why not make your own coffee or pack your own lunch? This can help to alleviate financial stress by constantly assisting you to achieve your savings goals.

5. Set realistic financial goals

Everyone, regardless of their financial status and stage of life, should have a financial goal. It could be for the short-term, mid-term, or long-term. Short-term goals are usually saving up for an emergency fund or paying off credit card debt. Mid-term goals could include taking out a car loan or funding a vacation. Long-term goals include buying a home or making sure you have enough money for retirement. Once you’ve set financial goals, make sure to plan out how you can achieve these goals.

6. Pay off more than the minimum with your debts

Debts can be a huge burden and cause money worries if they are not paid on time. If you have extra money such as a bonus from work, from your part-time job, or a cash gift, you can add this onto your monthly loan repayment to pay off debt faster and reduce your interest payable.

7. Pay down the highest rate debt first

If you’re stressing out about having multiple debts and don’t know how to manage all of them, tackling the one that has the highest interest rate first is always a good idea.

8. Save for an emergency fund

As the saying goes, “expect the unexpected.” An emergency fund will be readily available to you when you need it. This can alleviate financial stress when a problem arises such as a health problem or a loss of job. A lot of financial experts recommend saving for an emergency fund that can cover at least three months of living expenses. You can check your past monthly expenses to see how much you might need.

9. Continue learning about managing your personal finances

Whether or not you are in a stressful financial situation, it's worth investing in financial knowledge. The good thing is there are plenty of sources to improve your ability to manage your personal finances. You can read books, listen to podcasts, watch youtube videos and read blog articles. Improving your financial knowledge can help lessen financial stress in the future.  

 
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