Facing Your Financial Fears

Growing up comes with a large set of challenges, including mental health issues and financial difficulties. Very few people go out into the world without any worries about what will become of their future due to the prevalence of financial troubles among lower and middle classes. Financial stresses are often very complicated, and anxiety and depression can make them even more difficult to deal with than they would otherwise be.

However, facing your financial fears and dealing with debt and large financial decisions can be extremely helpful in improving mental health, as these can be some of the most stressful issues people ever have to deal with. According to APA CEO and Executive Vice President Norman B. Anderson PHD, “Regardless of the economic climate, money and finances have remained the top stressor since our survey began in 2007. Furthermore, this year’s survey shows that stress related to financial issues could have a significant impact on Americans’ health and well-being.” Financial stress has a huge impact on both physical and mental health, which is why the source of stress should be addressed as quickly as possible.

Managing Student Loans

Graduating from college comes with a lot of relief and weight lifted off former students. However, it is the start of the era of paying back student loans. Student loans easily become overwhelming considering that they are often one of the largest debts you’ll accrue throughout your life. Hopefully, once you’ve finished school, you’ll have a great job lined up that will make paying loans back easy, but for a majority of college graduates, this is not the case. It typically takes years before achieving a decent paying job, which means that there will be a period of time when student loans will be one of your largest bills each month. This can be a stressful situation but there are ways to manage student loan debt that will make it seem less daunting.

Managing your student loan debt is something you should do right after you graduate from college, as well as in between jobs. Loan servicers offer many types of payback arrangements, including income-driven repayment, loan refinancing and consolidation, and forbearance. If you are on an income-driven repayment plan, it’s important to submit paperwork between jobs in order to keep your monthly payments manageable based off your wages. While this paperwork can be time-consuming, putting it off is bad for your financial situation as well as your mental health. Not only is this a source of stress, it’s also a source of guilt knowing that is a pending responsibility.

Buying a Home

When you have a stable job, you may start thinking of investing your income into a home. This is an exciting decision to ponder, but can also be an extremely stressful situation. Buying a home is usually the largest purchase most individuals will make in their lives, so the decision can be surrounded by worry and doubt even after calculating the logistics of the investment. Big decisions can be a large source of worry and the confusion that comes with them often weighs on your mental health as well.

Making a sound decision can help allay some of these fears. There are a ton of considerations when buying your first home, such as calculating your debt-to-income ratio, loan-to-value ratio and understanding your mortgage options. Hiring a real estate agent to help you analyze the housing market can also help you avoid buying at the wrong time and potentially going underwater later on down the road. Investing in a home can save you money in the long run compared to renting, but it can also be a lot of work to keep track of, so it’s important to know what you’re getting into before making the commitment.  This can ensure you don’t make a decision you might regret and give you peace of mind.

Creating a Budget

Budgets are the key to a good financial status. While it may be difficult to put money away for emergencies, living within your means and saving a bit of money can be the difference between being able to handle unexpected expenses such as needing to replace some tires or an unforeseen medical bill. Whether keeping a well-managed savings account or stashing cash under your mattress to keep it out of mind, finding ways to put some money away each month can help get you out of a pickle later on that year.

Taking the time to craft a budget and develop lifestyle habits to ensure you stick to it can take a lot of time and energy, but managing your budget will save you a lot of stress over financial problems in the long run. Whether you’re reassessing your budget to buy a home, or while managing your student loans, knowing where your finances are at can help improve your mental health and decrease a lot of worries that come from ignoring those complex and cumbersome responsibilities. Put in the time to relieve the pressure on your subconscious and manage some financial dilemmas today.

Photo by Alice Pasqual on Unsplash