Times are tough, no doubt many of us are experiencing financial burdens right now. Life was completely turned upside down for nearly everyone across the world in the last 18 months. We’ve been unable to interact with others in normal ways, and that’s been hard… especially for extroverts. Additionally, financial stress has impacted many of us and has created mental health challenges that are multi-faceted and that compound to feel insurmountable.
In this article we’re going to discuss 3 financial moves to help your mental health in times of financial burden…
- Keep A Budget
- Be Proactive
- Explore Your Options
Utilize these 3 tools to help you manage your mental health in times of financial crisis…
1. Keep a budget
Many people get into financial trouble because they don’t keep a budget. A budget is a valuable tool to help you manage your finances and ensure that you’re properly planning for your financial future.
Keeping a budget is hard for many people for different reasons… Sometimes it’s just hard to look at your bank account and see a lack of money. Sometimes it’s hard to regulate your spending because of social pressures or stigmas. Sometimes it’s hard to predict the exact amount of money you’re going to receive during a given pay period because of the industry you work in.
For me it’s often been hard to create a budget because of the inconsistency of income. For some of my friends, it’s the social status that comes along with having nice things that keep them from creating and sticking to a budget. Whatever it is that’s keeping you from creating a budget, understand that the excuses will continue to flood in and the only way past them is action.
Set aside a time to review your income over the last 3-12 months, average your income and your expenses. Break them down into categories and look at the places that you are spending money that don’t bring you towards your end goal in life. Eliminate the unnecessary so you can double down on the things that you love… Budgeting doesn’t have to be scary or a place where you need to make yourself unhappy, instead it can be a place that you are happy to visit because it can show you how you can spend more money on the things that truly matter and bring you joy.
Check out Ramit Sethi’s article on budgets. He’s got a unique approach to creating a budget that’s not only effective but in his words, “Isn’t about cutting back on your latte spending.” In fact he encourages you to find the things you really love and 10x your spending on those items in order to experience the rich life you want…
2. Be Proactive
Once you’ve established a budget, make sure that you are proactive in upholding it. Another strategy that Ramit employs is automated finances. This is the next step in living a rich life in his plan. For some though, you may be in such a financial position that you can’t even think about living a rich life. You may be upside on your mortgage and unable to make payments… You may be struggling to create enough income to cover your current expenses and unable to find places to cut your spending as well. In this case, there are still ways to help yourself.
Dan Belcher at Mortgage Relief, an Oklahoma based company that specializes in short sales and pre-foreclosure solutions for homeowners that are struggling with paying their mortgages, recommends being hyper-proactive about contacting your loan providers and explaining your situation. He says, “most lenders are incentivized to work with you in some way or another to help get financial relief from your mortgage.” It may not always be the perfect solution that you’re hoping for but oftentimes it’s more expensive for a bank to foreclose on a property than it is for them to work with you. It could be a forbearance, a short sale, or deed-in-lieu of foreclosure that helps you save yourself from foreclosure and the damage that it will have on your life.
Dan Mentions that, “Foreclosures are damaging to not only your credit but also other areas of your life and can even affect your ability to get certain security clearances.” By being proactive in trying to seek solutions from your creditors, you can often find yourself options, and find empowerment within your financial situation.
The most prevalent part of the financial burden for most people is the feeling of helplessness. When you are proactive in co-creating solutions with your lenders and creditors, you will often find that not only are you not helpless, but you have the ability to help shape your financial future.
3. Explore Your Options
Throughout the pandemic, there have been several ways that the government and companies have tried to help those who are struggling financially. As you know, that feeling of helplessness is easy to buy into and it’s easy to tell ourselves stories about there being no options… Most of the time, this just isn’t true. When we’re forced to take action, we often see how many options that we have.
When looking at your finances, it’s easy to write off options because we’re just simply unwilling to swallow our pride or ego, or because we just don’t believe something will work. Often times there are a number of options out there but our own stories of helplessness get in the way of seeking them.
No matter what the problems are that we face in life, it’s often creativity that will help us solve them and allow us to find true freedom. As Albert Einstein once said, “we can not solve problems with the same level of thinking that created them.”
This means that we need to get creative and explore other possibilities to solve problems that we have in our life. Sometimes that means selling possessions that we cherish and think we need, sometimes that means going back to old employers and asking for a temporary job, sometimes that means finding new ways to generate money… No matter what the problem is, creativity is often the solution.
If you’re in a financial situation that’s stressful, utilize all of your resources to get help. Talk to your financially savvy friend about it and refuse to take advice from those that don’t have the success you’re looking for. Many naysayers will tell you that you’re trapped and only reinforce the idea that you can’t get out. Refuse to listen to them and utilize every available resource that you have at your disposal to create the results you desire.
In conclusion, it’s hard on your mental health to be in financial distress. Oftentimes we tell ourselves the story that we’re stuck in the positions that we’re in without the ability to help ourselves. Try these 3 financial moves to help your mental health in times of financial burden and see what comes of your next 3-6 months.