Money Stress Tips
Quinn Waddington - Nov 14, 2018
A survey done by Seymour Consulting in May and June of this year found that money worries kept 45% of people up at night, with 39% saying it affected their physical well-being. Both of these numbers are up from last year.
I will start by saying that the tips below will not reduce those numbers to zero, as there are many big issues causing financial stress for thousands of people, but these financial stress reducing tips may help many.
Create a Financial Plan. 90% of Canadians do not have a formal plan in place for their retirement. It should go without saying that not having a plan is a massive cause of stress. Once you have put your plan in place you will have guide posts that you can reference to ensure that you are on track to achieve your goals. The markets will move up and down, but you won’t have to worry about the daily movements as long as you know that you are still on track according to your long-term plan.
Create a Budget. This is another task that should be created and updated on an ongoing basis. It is actually part of your Financial Plan but if you don’t stay on top of the expenses side of the equation, you will find it harder and harder to save enough money to keep up with your plan. Ask me for a template you can use.
Pay Bad Debt. There is good and bad debt, so avoid the bad debt. While good debt is used to buy assets that generate wealth, such as real estate, bad debt is generally created from spending and is charged incredibly high interest rates. There are a number of ways to accomplish this but one that I have seen a few times is securing a LOC from your bank and transferring credit card debt to it. Then paying off the LOC much sooner with the lower interest payments.
Get Informed. Much like having a Financial Plan in place, the more knowledge you have, the less you will have to worry about the unknown. It is impossible to know everything and there are some things we can’t control but having the knowledge of when and how to react will reduce the anxiety you may be feeling when you see scary headlines or open your monthly statement. There is a ton of information available so be sure to use trusted, reputable sources and if you simply don’t have the time or desire to do this research then focus your research on finding a trusted advisor to work with.
Hire Professionals as Needed. I am not sure why there is a disconnect when it comes to finances but much like trusting a contractor or a mechanic, you should look to hire professionals to help you with your finances. If you have the time and desire to learn how to complete a renovation, great. However, attempting a renovation without training will likely end up costing you more and potentially be very dangerous. As mentioned above, financial stress affects physical well-being so if staying on top of your finances aren’t your passion. Then find accountants, investment advisors, lawyers, notaries, mortgage brokers, etc.) that you can trust to guide you. In many cases, these professionals can actually save you money from current situations, on top of reducing the stress of dealing with it yourself.
Open Up. Luckily I have some great clients who are willing to refer me to their family and friends (http://www.waddingtonwealth.com/testimonials ) but for many, speaking about personal finances is taboo. While I understand that sharing the details on your personal savings and expenses don’t need to be shared but speaking about finances with people you trust is a great way to gain knowledge. Perhaps your friends use an accountant that was able to reduce their taxes or moved from the bank to reduce their investment costs. You don’t need to blindly trust their advice, but it gives a good starting point for your research. Even sharing this post could help a few of your friends.
All of this may seem like a lot but from my experience helping individuals with their finances, the best way to reduce financial stress is to have a Financial Plan in place. Your Plan will guide you but also give you a document you can reference and continually update as you move through life. Having your Plan will reduce the stress and that nagging feeling many people have about neglecting their finances.
Please call or email me with your thoughts and questions about my money stress tips or if you’d like to book a free Financial Planning session.
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