Tips for getting your finances right

Many people mistakenly believe their financial stress would disappear if they had more money. Sometimes, earning more is the solution to improving your finances. However, many people with “enough” income still feel anxious about their financial lives.

While money stress or anxiety may never completely disappear from your life, reducing it can improve your relationships, health and general well-being. Use the following eight strategies to stay calm, think clearly and create solutions to any financial challenges.

1. Adopt a new money mindset.

For many, financial stress comes from projecting a worst-case scenario into the future. You can exaggerate a situation in your mind to the point that your heart starts pounding and your palms start sweating.

If that happens, remind yourself that you’re in the present moment where you have the power to make a difference. Also, never believe that a financial challenge is a sign of personal failure or weakness. Whatever your situation, millions of people have struggled with the same money issue.

Though it may sound cliché, keeping a positive attitude and using positive language can reduce your stress response to financial problems. Instead of dwelling on what’s wrong with your finances, think about what’s going right that you can be grateful for.

2. Radically cut your expenses.

If you’re spending too much due to hardship or chronic overspending, your savings may be dwindling while your credit card debt skyrockets, along with your anxiety level. You’ll need to decide what’s truly important and take control by creating a spending plan and aggressively cutting your expenses.

For instance, if your housing expense is a source of financial stress, consider downsizing or relocating to a less expensive neighborhood or town. Taking a similar or better job in a less expensive area is another solution to get ahead financially. A good rule of thumb is to spend no more than 25% of your gross income on a mortgage or rent payment.

RELATED: Budgeting guide–6 steps to get started

3. Automate your saving goals.

A simple plan to achieve your goals, such as building emergency savings and retiring, can be the secret to alleviating money stress. Workplace retirement plans work well because contributions come from your paycheck before you can spend them. If you have one, always contribute enough to max out any employer matching.

If you’re self-employed or work for a company without a retirement plan, you can automate contributions from your bank account to an IRA. Even if you can only set aside $50 a month for retirement, you’ll be surprised how quickly your balance can grow.

ALSO SEE: 9 best IRA accounts for 2024

4. Take control of your debt.

If debt stresses you out, get serious about reducing expenses so you can pay it off as quickly as possible. A good rule of thumb is to keep your total monthly debt obligations below 40% of your gross monthly income.

Even if you don’t have extra money to whittle down debt balances faster, you can cut your interest expense by using a balance transfer credit card or changing payment plans on a student loan to make it more manageable.

5. Create extra income.

Creating one or more streams of additional income is like an insurance policy. Not only does making more money help you pay the bills and eliminate debt faster, but it helps you maintain security if one of them dries up.

Consider how you can leverage your skills to build a profitable side business. Most people have interests and expertise others would pay for, such as designing, driving, caring for pets, writing or tutoring.

6. Stay informed about your finances.

If you delay looking at bills or creating a budget, you may be avoiding your money reality, causing stress. Instead, track your spending and savings to know what areas of your financial life need improvement.

READ ALSO: 9 ways to build emergency funds using a high-yield savings account (HYSA)

7. Take stress breaks.

You’ll feel more in control once you’ve focused on the positive, cut expenses, put savings on auto-pilot and create extra income sources. But as I mentioned, you may never eliminate all money stress.

If you start feeling anxious about money, do something healthy to take your mind off your stress. For instance, you might play with your dog or kids, go for a run, enjoy a hobby, watch a movie, listen to music or exercise.

8. Get professional help.

If you have persistent financial problems you can’t solve alone, talk to a wise friend, family member or certified financial adviser. They can help you see options and solutions you may be overlooking. That can go a long way toward gaining clarity and control and ultimately reducing money anxiety.

About the author

Laura Adams is a money expert and spokesperson for Finder. She’s one of the nation’s leading personal finance and business authorities. As an award-winning author and host of the top-rated Money Girl podcast since 2008, millions of readers, listeners and loyal fans benefit from her practical advice. Laura is a trusted source for media and has been featured on most major news outlets, including ABC, Bloomberg, CBS, Consumer Reports, Forbes, Fortune, FOX, Money, MSN, NBC, NPR, NY Times, USA Today, US News, Wall Street Journal, Washington Post and more. She received an MBA from the University of Florida and lives in Vero Beach, Florida. Her mission is to empower consumers to live healthy and rich lives by making the most of what they have, planning for the future and making smart money decisions every day.

This article originally appeared on Finder.com and was syndicated by MediaFeed.org.

Written by

Laura Adams

Money Expert and Spokesperson

Laura Adams is a money expert and spokesperson for Finder. She's one of the nation’s leading personal finance and business authorities. As an award-winning author and host of the top-rated Money Girl podcast since 2008, millions of readers, listeners, and loyal fans benefit from her practical advice. Laura is a trusted source for media and has been featured on most major news outlets, including ABC, Bloomberg, CBS, Consumer Reports, Forbes, Fortune, FOX, Money, MSN, NBC, NPR, NY Times, USA Today, US News, Wall Street Journal, Washington Post, and more. She received an MBA from the University of Florida and lives in Vero Beach, Florida. Her mission is to empower consumers to live healthy and rich lives by making the most of what they have, planning for the future, and making smart money decisions every day. See full bio