How to Deal with Money Stress: “Snap out of it!”
Today’s topic is about money and stress, and what you can do about it.
We all know that money is one of the leading causes of stress. A survey, conducted by the American Psychosocial Association in 2014 polling over 3000 adults, concluded that 72 percent of Americans reported feeling stressed about money at least some of the time during the past month. For 64 percent, money was said to be a significant source of their stress, and this was especially true among parents and younger adults (millennials and Gen Xers).
Common ways in which stress can hinder your money goals include:
1) You’re worried about market volatility and decide to pull out of the stock market when it’s dropping
2) Similar to yo-yo dieting, you “yo-yo” spend, drastically cutting expenses only to binge a few days later because you feel deprived and falsely conclude that budgeting is too hard
3) You pick a fight with your spouse and it becomes harder for the two of you talk about money
4) You put off dealing with your bills and paperwork, and leave things to the last minute, if at all
On a rational level, you know that stress is not productive, that in fact it is usually detrimental not only to your health but to the financial outcomes that you actually desire.
However, the key work here is rational. By the time we are actually feeling stressed, we have already moved out of the part of our brains that controls our rational thinking. We have moved into the part of our brain that controls our flight-flight responses, triggering the stress hormone cortisol that makes us our heats beat faster and our blood pressure rise, and that makes us behave in ways that we wouldn’t necessarily behave if we remained calm and rational.
So the question becomes, how do you pull out of that pattern? How do you – as Cher so eloquently stated in the film Moonstruck – “Snap Out of It!” and return to a more rational way of thinking when it comes to money?
A great place to start is by using the fire safety technique taught to children or other emergency personnel as an analogy: Stop, Drop, and Roll.
In a fire, it was advised not to panic, and instead, stop where you are, drop to the floor, and roll to a safer area while extinguishing flames in the way that would cause the least harm.
The same technique can be applied to dealing with money and the panic – or stress – we feel as a result of it:
1) STOP: The first step in dealing with stress – or any unwelcome emotion for that matter – is to be aware of it. Awareness is key – because it helps you become conscious of your own responses, rather than seeing them as automatic.
Stop and recognize that you have a choice in how you choose to respond; IT IS NOT AUTOMATIC, though it may seem like it is at first. By stopping and being aware, it it puts you in a position to be able to change it.
2) DROP: In this analogy, “drop” means to anchor yourself back into the present moment. One of the reasons that money triggers so much stress is because we allow what may be a neutral circumstance (e.g. “stock price drops” “bill increased” “husband went shopping”), project it into the past or future, and have it mean something negative (e.g. “I will lose my nest egg” “I will be kicked out of my apartment” “We won’t be able to afford the things I want”). The problem with doing this is that it clouds our clarity and often closes us to consider other solutions and possibilities.
Easy ways to anchor yourself into the present when feeling the onset of stress include: breathing and meditation exercises, using a physical object to help that ground you, such as touching your thumb and ring finger together, or changing your physiological state by going for a walk, taking a shower, etc.
3) ROLL: In many cases, it’s not enough to “stop” and “drop.” You may need to “ROLL” out of your own head and ask for advice from someone else. This is your best bet in not making irrational financial decisions that may hurt your likelihood of achieving your goals.
In fact, some believe that advisors and coaches’ greater role is less in knowledge they import, but more in helping their clients stay grounded. In addition to advisors and coaches, you could turn to a friend, a spouse, or even media resources, as long as they provided trusted “second opinions” and offer other ways of looking at a situation that may be more rational, rather than coming from a fearful, stressful vantage point.
Stress is a choice. It clouds our money decisions, and can actually be a detriment to accomplishing our goals. So, “Snap out of it!”, “Stop, drop and roll” and let’s put out some irrational fires so we can create the financial lives we dream of having.
Schedule an initial consultation at jennifer@financialwealthbeing.com.