Financial health, physical health, and mental health all work together. But many people worry about their financial health. Many Americans lose sleep about financial worries — everything from anxieties about spending too much to fears that they don’t have enough to retire on.
Lack of sleep may become a health problem, but that’s not the only health concern financial anxiety causes. Anxiety may also result in headaches, high blood pressure, muscle tension, heart conditions (attacks, arrhythmias), insomnia, and possibly even depression. All of these conditions, of course, can increase stress even more. If they impact your ability to work or manage your finances, they can deepen your financial worries.
Concerns about either your finances or your health (or both) can, in turn, affect your mental well-being and could result in difficulties with relationships, jobs, as well as money management.
The interplay of the three — financial worries, physical illness, and mental strain — can work as a vicious cycle, sending you deeper into a tailspin.
To stop the tailspin, consider establishing wellness in all of these areas. Fortunately, this can be easy to do, because all of these facets can also work together in a virtuous cycle! Control of and clarity about your finances can make you feel better. You stand straighter and sleep better at night.
If you are not feeling financially healthy, what can you do? One of the chief problems with financial worry, in fact, is that it can seem insurmountable. But it isn’t. It can be managed, and you can become much calmer and assured about all aspects of your life.
Steps to Financial Wellness
The steps to financial wellness (or getting more of it, if you are reasonably financial content but need a tune-up) are these.
1. Don’t Go It Alone
If you’re worried about your finances, don’t try to go it alone, for multiple reasons. First, financial problems that may seem very overwhelming to you may be simple to a financial coach or planner. It might be something they encounter all the time. Let them exercise their expertise on your behalf.
Let’s say make a very good salary, but are concerned that you don’t have enough for retirement. You can’t figure out how to save more since you’re already 50. You may not even know how much you need in your retirement years.
Those issues are common even among high net worth individuals. A financial coach and advisor can let you know about the 50 and over catch-up contributions for Individual Retirement Accounts (IRAs) and 401(k)s, advise you to check into matching 401(k) contributions (or perhaps search for a job that has them). They can also help you budget so you can save more and, crucially, figure out a plan for how much you need.
Sound like a lot? Financial advisors in Libertyville, IL do that every day, and more.
Even if you’re very financially savvy, trying to do your own finances entirely is somewhat similar to lawyers trying to handle their own legal cases. It’s not advisable simply because it’s not the best way to have a good perspective.
Second, it’s not uncommon to feel guilt and shame about any money worries. You may worry that you’ll be viewed as irresponsible, too much of a worrier, not keeping up with the Joneses…the list of worries may be endless. Guilt and shame can be paralyzing and they may keep people away from seeking the help they need.
But reaching out to financial coaches and advisors can eliminate shame. Financial worries are common enough that there’s no need for guilt and shame. Not only that, but financial advisors can help you with the worries, which reduces guilt and shame on its own.
2. Create a workable budget
The term “budget” sometimes gets a bad rap because it has connotations of cutting down on your spending. As financial professionals use it, though, it doesn’t mean that. A budget is more like a cash flow statement. It’s a record of how much you spend per month versus how much income comes in.
Budgets like these are crucial because they eliminate guesswork. Do you worry that you spend too much on eating out and not enough on your child’s higher education, for example? The only way to know is to keep a record of those expenses.
(And then, strategize how much you need to spend. There is no abstract “too much” and “not enough,” because financial spending and earning depend upon your goals. If your goal is to hit every four-star restaurant in the country, you may have to up your eating-out budget! And that’s just fine.)
Budgets with firm records of your expenses and income will also let you know how much disposable income you have after paying expenses like mortgages, utilities, food, and more. If you want to devote more to retirement savings, or higher education savings, or travel, you can, but you need to know how much disposable income you have.
Finally, if you have a mismatch between spending and earning, you can rectify it with the help of a budget. If you earn a good income but are still overspending every month, you can examine a budget for what categories might be reduced.
Every comprehensive financial plan checklist will include budgeting. A financial advisor can help you create a budget as part of an over-arching financial plan. But you can begin by keeping track of all your expenses.
That’s the building block of any budget. Every expense, from the mortgage on your second home and kid’s tuition to the candy bar you get from a vending machine this Saturday. Do that every day, in a dedicated notebook or software.
After a week, enter the expenses on a spreadsheet. Divide them into reasonable categories, such as mortgage/rent, utilities, groceries, clothing, and so on.
Keep track of all income as well: paychecks, dividends, rent payments if you’re a landlord, and so on.
At the end of every month, you’ll compare your income and expenses, making adjustments as necessary.
A financial advisor in Libertyville, IL can improve your financial health — and with it, possibly your physical and mental health too.
At Prism Planning Partners, we are CERTIFIED FINANCIAL PLANNER™️ Professionals committed to facilitating important questions so that we can help you explore all of your opportunities. We offer a broad array of holistic financial planning and consulting services for our clients-including retirement, investment, and estate planning.
Contact us today and let us illuminate your possibilities!