NDSU Extension Service - Ramsey County


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Anxiety and Money

Anxiety and Money


A normal life comes with unexpected large expenses like medical problems or household repairs. Replacing a heating or cooling system can cost thousands, which will unbalance most anybody’s budget. Most people have a little anxiety when it comes to making large purchases. Buying a major appliance, a car, or a home can initiate serious second thoughts as to if you are making the right decision.

                For some individuals though, money anxiety is a constant.  The simple act of writing a check to pay the usual monthly water bill causes stress for some.  “Money anxiety disorder” is a term used by psychologists to describe a condition of constant worry and unease about money.  A person with “money anxiety disorder” has a pervasive fear about money that triggers the “fight or flight” response. When this fear-based response is triggered, our rational minds get pushed aside and emotions tend to predominate.

                Reducing money anxiety and feeling better about our financial situation requires more than simply balancing a budget. What is needed is a practiced awareness of how we feel when we’re in situations involving money.  We need to have practices around money that help us acknowledge and deal with our feelings about it.  Some small steps can keep our budgets and anxiety levels on a straight line to success.

                Make your savings automatic: A cushion of savings can greatly relive anxiety about everyday expense for everyone.. A habit of saving can give you a huge amount of peace of mind, and, if you have a budget, you'll have a category in your budget just for saving.                To make saving as easy as possible, and so you don't spend what you had planned to save, set up your direct deposit to automatically send a certain percentage of your paycheck directly into savings.

                 Use cash. We tend to spend less when we must pay with cash as opposed to paying with a credit or debit card.  We also feel more in control when we hand over actual dollar bills and coin. Knowing that you have made a conscious decision to spend lowers the levels of anxiety.

When people use cash, they value their purchases so much more.

                 Learn about money. Read up on stocks and bonds – even if you don’t own any! Review the stock market report occasionally.  Do you know what your health insurance policy covers?  Knowledge is power and the more you know, the more your comfort level increases. Managing money is a skill -- and it doesn't happen overnight.

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