Persistent worrying about having enough money for day-to-day living tends to stress you out.
There can be times when you lose a significant part of your investment or have to make a large payment suddenly and unexpectedly. At such times, worrying about money can frazzle your nerves and steal your enjoyment of life. Today, we look at how to deal with money scarcity concerns and their effect on emotions.
We all tend to worry when a payment is due and there are insufficient funds to meet the debt. Particularly for some retirees, or the unemployed or under-employed, these concerns are real and very present. Generally, when you are employed, suitable adjustments may be made in earning and spending in order to bring your personal budget back in line with your means. Even if there is a rise in the cost of living, or increased taxes or an increase in some other salary deduction, you stand some chance of working to find a way of making ends meet.
However, on a fixed and usually reduced retirement income or when you are unemployed, the change in cash available may be too sharp to make agile adjustments. For these difficult times, it may be best to seek as expert advice as you can afford, to talk with other people who may be in a similar situation, and/or to seek out friends who would be willing to give worthy advice for free before making any sudden changes.
Here are six pointers:
1. Review and prune your monthly spending plan of any unnecessary spending. Is there any opportunity to earn more working part-time or by launching an in-home business? Can you bring to bear additional free cash per month? Can you negotiate extended monthly payments for some expenses rather than one lump sum payment? Scrutinize your spending plan to see how you can eliminate or stretch out each payment.Â
2. Discuss any debt repayment adjustment well in advance with your creditors, eventually committing any notice or agreement to writing. This is a good way of avoiding harassing calls that can leave you upset for days.
3. If you can afford to repay more than your needed monthly debt instalments, then use the extra funds to pay down the debt with the highest interest rate first. Once that debt is paid off, then apply that first loan’s instalment and extra payment to the next loan which has the highest interest rate and so on, until you are free of debt. You will likely be surprised how quickly you can become debt free using this system.
4. Create or enhance your emergency fund: a fund held readily accessible in a credit union or a money market account that can be quickly converted to cash in hand should you need it for some contingency.
5. This is the time to build up relationships with relatives and friends; you help them where you can, and they help you where they can, including bartering goods and services amongst each other.
6. Consider cheap ways to relax and exercise – maybe taking a long walk, watching a home movie, maintaining a regular exercise routine right at home or reading a light novel. Ensure that you get a full night’s sleep regularly.
In order to avoid stress, it is paramount that you place high value on the wealth around that does not cost money: the love of family and friends; the beauty of nature, and the peace of praying, of spiritual development and of meditation. Upset emotions and worrying are counter-productive. In difficult or uncertain times, control what you can, and leave the rest to the Almighty.
• Louise Fairsave is a personal financial management advisor, providing practical advice on money and estate matters. Her advice is general in nature; readers should seek advice about their specific circumstances.