1st to 5th November 2021 is International Stress Awareness Week. We take a look at the biggest causes of stress and steps you can take to eliminate them.
Stress is the health epidemic of the 21st century. It can trigger a wide range of emotional and physical conditions from depression and insomnia to high blood pressure, diabetes and heart disease. And the biggest cause of it? Yes, you guessed it, finance!
Numerous surveys have named finance as the number one stress factor in our lives.
- This Capital One survey revealed that 73% of Americans find finances to be a point of stress in their lives with 82% of Generation Z and 81% of millennials saying that finances are their biggest point of stress.
- Meanwhile in the Asia Pacific region, money worries are through the roof with 68% of Thai consumers, 67% of Vietnamese and 66% of Malaysians reporting financial stress.
Those who succeed in lowering their financial stress levels will be happier, healthier and less prone to a wide range of health conditions, so it makes sense to make this a priority. But how? Here are our five top tips to reduce financial stress.
Five top tips to reduce financial stress
1. Budget
Starting to budget is the equivalent of putting the lights on when you are stumbling around in the dark. We all think we know where our money is going but budgeting often highlights excess spending in unexpected areas. Tracking expenditure is empowering and enables you to identify where you can make savings in order to pay off debts and start building wealth.
Budgeting can be as simple as writing down what comes in and what goes out on a spreadsheet or if you prefer a digital approach, you’ll find a wealth of apps and online tools. Just get budgeting as soon as you can.
2. Get debt-free
The Money and Mental Health Policy Institute in the UK has established irrefutable links between money and mental health with 46% of those in problem debt reporting a mental health problem.
The best way of getting rid of debt-related stress is to get rid of the debt. Make it a financial priority by working out exactly how much you owe, putting in place a repayment plan and vowing to live within your means going forward. It may take time to zero your debt, it may take a long time, but it is the first step on the road to financial freedom.
3. Have an emergency fund
Are you familiar with that sinking feeling in the pit of your stomach when a surprise bill drops into your inbox? If you are constantly living pay cheque to pay cheque it will be there all the time, piling financial stress on to your shoulders.
The solution: an emergency fund. There is nothing like the peace of mind that a few thousand dollars in the bank to cover unforeseen emergencies brings. Start building up a cash buffer to turn the sinking feeling into a surge of relief. Six months’ worth of expenditure is an ideal amount to aim for.
4. Save for the future
It’s often the ‘what ifs’ that cause the most stress. What if I can never afford to buy a house? What if I don’t save enough to retire? What if my child wants to go to university?
A regular savings habit, based on your big life goals, can change everything. Saving little and often can yield surprising wins, especially when you factor compound interest into the equation. Investing wisely will maximise your return and build your wealth quicker.
5. Get help with your finances
Investing wisely is best achieved by seeking the help of a professional. It has been proven that individuals who work with a financial adviser are wealthier. In one Canadian study households who had chosen and retained a financial advisor accumulated nearly three times more assets, on average over 15 years, than those who did not have an advisor.
Our advisers are ready and waiting to help you get your finances in order and banish financial stress. Why not contact us and get started right away?
A leading provider of expat financial services and wealth management services across Asia.
