In most cases, debt and stress go hand-in-hand. This type of stress can negatively impact your personal and professional life and lead to physical and mental health problems. If you’ve found yourself overwhelmed with debt-related stress, consider the following strategies to take back control:
Strategy #1: Be Honest With Where You Stand
The first step to eliminating debt is to acknowledge you have money problems. Don’t pretend everything is all right (that won’t help you). Write down what you owe and to who — don’t leave anything out. When you review your list, it may feel overwhelming (and that’s normal). Just know that it truly is the first step toward debt relief.
Strategy #2: Make a Plan to Eliminate Your Debt
For some people, this will take a few months, and for others, it may take a few years. But now that you know how much you owe, you can make a plan to eliminate your debt. First, you should prioritize your debts in order of importance to you. What would you like to pay off first and why?
Once you establish priorities, you should create a budget to help you pay down your debt and hold you accountable. Plus, you’ll be able to see how much you have available if you’d like to pay off more than planned. For example, once you’ve paid down one debt, you can use this extra money to pay down your next debt priority, and so on. A budget will also help you see when you’ll be debt-free, which can be very motivating.
Smart idea: Meet with a financial advisor to help you establish a reasonable budget that works for you. Plus, your advisor can also discuss investment strategies for your future as well.
Strategy #3: Determine How You Can Change Your Spending Habits
Everyone responds differently to financial stress. But for many people, the more overwhelmed they feel, the more likely they’ll buy something to feel better (even if they don’t need it). And while that will create short-term happiness, it may add to their stress in the long run. Instead, make a concerted effort to stick to your budget and spend what you’ve planned. It will take discipline, but you can do it. Keep your goal in front of you and ask yourself, “Do I really need this? Is this something that is going to help me move forward or backward?”
As you begin to change your spending habits, you may need to replace your shopping excursions or other expenditures with something else. Consider doing things that will eliminate your stress and improve your well-being. Why not take a walk or talk with a friend. Maybe you can go to the gym or do an at-home workout or even meditate.
Strategy #4: Focus On Your Well-Being
If you’re struggling financially, you may be tempted to put your health on the backburner. You may skip doctor or dental appointments or eliminate anything that “appears” to help you in some way. Don’t do it. Your health is more important than anything else, so be sure to do things to continue to improve your well-being. Take time to relax, enjoy yourself, and do what you can to get your mind off your problems. If you’re on a strict budget, you can do things you enjoy that don’t cost a lot of money. For example, meditate, soak in your bathtub, or take a walk with a friend. These types of health-focused activities will give you the time needed to rejuvenate your mind and body when needed. And you may find you sleep better as well.
Warning: Don’t criticize or punish yourself for past financial choices — that will not make your situation any better. Focus on the positive and the future.
Strategy #5: Get the Help You Need
When you’re sick, you probably turn to a doctor for help. So, you may need to do the same thing with your financial problems. There are trained professionals to help you set goals, create strategies to achieve them, and hold you accountable along the way. You can find an accredited, non-profit credit counselor near you to help you get back on track. And with a plan in place, you’ll begin to see your stress melt away.
Whether you’ve recently experienced financial problems or you’ve been dealing with them for years, use these strategies to help you get back to the life you want. Take control today to eliminate debt, reduce your stress, and start looking forward to a brighter future.