Money is second only to sex in terms of being one of the most common sources of stress I see in my patient practice. When our financial situation is going well (meaning finances are stable, within our control, and effectively serving as a means to important ends), our overall sense of wellbeing and health (both physical and emotional) is improved. When our financial situation is out of our control, emotional distress results.
Despite the fact that finances are consistently reported as one of the top stressors for adults nationwide, there continues to be a significant amount of stigma and shame individuals experience when talking about money. We aren’t taught financial skills in grade school, and very few of us have parents that educated well in this realm. It’s never too late, however, to start educating yourself.
Here are some effective tips to start to get a handle on your money:
1. Think about money as being a means to end. Articulate your financial goals and dreams, and establish specific and actionable goals.
In and of itself, money means nothing. This may sound like an obvious statement, but regularly remind yourself that money is just a means to an end. Identify what that end is for you. What are your short-term and long-term financial goals? What short-term and long-term dreams do you have? Be specific about what you want to achieve, and write those things down. Research demonstrates that when we write our dreams down, we are much more likely to follow through on achieving them. Then establish specific and actionable goals. For example, saying you “want to save more” is a general and non-actionable goal. Saying you “want to save an extra $100 per month” is a specific and clear goal. Then, identify what actions you will take to ensure this happens. The more specific you are, the more likely you are to be successful.
2. Identify the emotion states that surround money for you.
Money is an emotionally charged topic! Many of us have a number of strong emotions that surround money and finances – this can include fear (e.g., about having enough to survive), guilt or shame (e.g., if you have made poor financial decisions in the past), anger (e.g., at a partner’s spending habits) or low self-esteem/confidence (if you lack strong skills in managing finances). The emotional reactions we have surrounding money often come from our family of origin, can be strongly ingrained, and can interfere with our ability to take next steps with respect to improving our financial health. Pay attention to the emotions (and associated thoughts) that come up for you. Try to identify the source of those emotions, and work to problem-solve those causes.
3. Confront your financial challenges head on.
When we are faced with worry or stress about anything in our life – including finances – we have a strongly ingrained natural tendency to want to avoid and procrastinate on addressing those issues. Although avoidance helps us in the short-term, avoidance is an unhelpful long-term strategy in that our worry and anxiety grows over time. Pay attention to times that your urge to avoid surfaces, and be proactive in taking steps to expose yourself to things and situations that increase anxiety (e.g., opening bills, doing taxes, making an appointment with a financial advisor).
4. Manage your stress!
Financial difficulties are, not uncommonly, a tangible result of other stressors in our life, including relationship stressors. Identify the source of stressors in your life and work to proactively target and problem-solve those stressors, as doing so can have an overall significant positive impact on your financial health.
5. Never shop as a way to improve your mood.
Many people, particularly women, have a tendency to want to shop when mood is low, sad, depressed, anxious, or even angry. Although this can lead to a temporary lift in mood, often our decision-making is poor when we are experiencing negative emotions, and we often make decisions we later regret. Work to regulate other negative emotions and avoid impulse-shopping. Seek treatment for underlying mood issues if these have been unaddressed.
6. Identify your financial “needs” and differentiate those from your financial “wants”.
Most people are guilty of spending money on unnecessary things that they don’t need. Impulse-shopping, shopping when mood is low, and a desire to “keep up with the Jones’” are all contributing factors. Be honest with yourself about your financial needs (the “must-haves”) and separate those out from your financial wants (the unnecessary, “nice-to-haves”). If you are in a challenging financial situation, be mindful of how much is being expended on the wants, and actively work to reducing those expenses.
7. Channel your emotional energy into the things you can change, and work toward acceptance of the things you cannot.
No matter how hard we wish, will, or think it: we simply cannot change the past financial decisions we have made. Take a stance of radical acceptance of past decisions, mistakes and failures. Then focus your energy on what you can control moving forward. All too often, we get caught in ruminating about the past, and this does nothing other than increase our stress and worry, and interferes with our ability to put energy into changing our future.
8. Find a financial workout partner!
When it comes to our physical health, we have workout partners for a reason: they help us stay accountable, on track with our program, and motivate us when our urge is to avoid or procrastinate. Finding a financial workout partner can serve the same goal! Find a friend, family member, or neighbour who can serve as a buddy. Remember – almost everyone struggles with some aspect of their financial health, and all of us can benefit from having the support of someone who is also trying to make changes in their financial life.
9. Our financial health is intimately connected to our psychological and physical health.
Finances – and all of the related worries, anxieties and stressors that come along with being in a less than ideal financial situation – take a tremendous impact on our psychological and physical health. Be mindful that improving your financial attitudes and behaviours will have an overall positive impact on your psychological and physical health.
10. Remember: changing your financial behaviours is process and a journey, and slow and steady wins the race.
Once you make up your mind to tackle your financial situation head-on, it can be tempting to try to make immediate drastic changes. Remind yourself that there is no rush to the finish line, and that the best thing you can do is establish realistic and specific goals that are sustainable over time. From a psychological perspective, you are much more likely to succeed if you establish goals that you can stick to for the long haul.
Reminder: UBC staff and faculty have extended benefits that provide $1,200 coverage per year to see a Registered Psychologist. For more information, visit the UBC Extended Health Benefits webpage.
Dr. Joti Samra, R.Psych., is a clinical psychologist and organizational and media consultant. She is the host of OWN: Oprah Winfrey Network’s “Million Dollar Neighbourhood” and was the psychological consultant to CITY-TV’s “The Bachelor Canada”. She has also served as a psychological consultant and expert to a number of other TV shows and news outlets. Dr. Samra maintains a clinical practice in Vancouver. Her website is www.drjotisamra.com and she can be followed @drjotisamra