Almost every American will feel stressed about money at some point in their lives. You may even feel stressed about your wallet as you’re reading this. 

It could come from not knowing how you’ll pay your bills. Or maybe you’re worried about planning for the future like retirement or caring for your aging parents.

Financial stress often compounds. That means it can come from multiple sources. One missed credit card payment can lead to falling behind in other areas of your financial life. 

And because it’s rarely a hot topic of conversation at dinner parties, this stress may go undetected for long periods of time. Our personal finances aren’t something we Americans talk about very much. So it can be hard to identify its effects until it feels like too much.

Some studies show that over a quarter of Americans suffer from Acute Financial Stress (AFS). This can bring about symptoms similar to PTSD. 

Who is Affected By Financial Stress?

Put simply, everyone is affected by financial issues. It doesn’t discriminate. However, there are differences between demographics about the most common stressors.

For millennials, their top financial stressors include paying down student loans, job security, and creating savings goals for big life milestones. Following the Great Recession, many millennials struggled to find jobs that matched their education and skill levels. Consequently, millennials are getting married later and buying homes at lower rates

By contrast, baby boomers are most concerned about their upcoming retirement. Gen X is looking hard at their monthly bills and keeping up with debt.

And in the middle of the COVID-19 crisis, many Americans are experiencing even higher levels of financial stress. Even if you weren’t feeling the pinch before, you probably are now. Economic uncertainty and job losses have turned many households upside down. 

Why Do People Get Financially Stressed?

Financial stress doesn’t just come from buying too many lattes. It manifests itself for a multitude of reasons. Some of the most common reasons people get financially stressed include:

  • Planning for retirement
  • Paying bills on time
  • Saving for an emergency or unexpected expenses
  • Not earning enough money
  • Budgeting
  • Potential unemployment
  • Rising household expenses
  • Personal debt

Often, these factors all influence each other. Someone struggling to save money for an emergency may also be dealing with paying down debt. 

Emotional and Mental Effects of Debt

The ways financial stress affects our health is different for everyone. And the reactions you have to missing a bill may be different than your fears about the future. 

One thing is clear though. Debt is one of the most common sources of stress. Nearly 8 in 10 Americans carry some form of debt. That’s a lot of people! 

Americans carry an average of about $16,000 in credit card debt. The total average personal debt is even higher at about $90,000. 

For many, debt isn’t just a number on a screen. It isn’t just a bill that arrives in the mail. Real emotional and physical responses come with financial stress. 

Fear and panic can arise when a credit card bill is going to be late. This leads to losing sleep or feeling guilty about making other purchases during the week. 

Physical and Mental Effects of Financial Trouble

When your finances aren’t on track, it can feel like the world is working against you. Unfortunately, stress from your finances isn’t limited to emotional or mental effects. You can also start to feel physical side effects as well.

The most common effects of stress include headaches, trouble digesting food, and heart disease.

You may have trouble sleeping or develop insomnia. Weight gain and difficulty burning fat are also common. Depression can creep in when you feel like your situation will never get better. There may also be increased levels of anxiety or worry that can increase your blood pressure. 

All of these physical impacts of living with money troubles can impact your marriage, friendships, and more. 

What to Do If You’re Financially Stressed

Everyone feels financially stressed from time to time. But if your stress is persistent, it’s time to come up with a plan to tackle it. 

For starters, take some time to calm yourself down. We know that’s easier said than done.  But financial stress is manageable with the right tools and techniques. With a plan to tackle your debt or financial stressor, you’ll be able to work through it. 

Next, work to understand your current financial situation. We recommend checking out our article called How Is My Financial Health? It will help you compartmentalize areas of your financial world to understand where you should focus your attention. You time block out your calendar, so why not block out areas of your finances?

Tip:

All of your financial stressors will likely intersect with your budget at some point. If you’ve never created a budget before or you’re looking for a refreshed, we’ve got two budgeting guides.

We cover the two most popular budgeting types, zero based budgeting guide and the 50/30/20 budget template. We’ll show you how sticking to a budget can guide your financial decisions.

4 Changes You Can Make Today to Alleviate Financial Stress:

Dealing with Financial Stress Long-Term

If you’re currently financially stressed, it’s unlikely it will be the last time you encounter it. And with so much uncertainty because of COVID-19, financial stress may take some time to get through.

Take time to focus on your mental and physical health by spending time outside. Get a plan in place about how you’re going to tackle your financial stress moving forward.

As stressful as your money management can feel, knowing how to deal with the stress effectively is even more important.

Hopefully this article has helped you understand your financial stress better in addition to some simple steps that you can take today. We’d love to hear from you, so let us know your thoughts and feedback in the comments.

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