5 Ways to Manage Financial Stress After the Pandemic

The unforeseen circumstances that the Coronavirus pandemic created has seen many of us have to face unexpected changes in our finances. With most businesses having to close for at least three months, and others unfortunately closing for good, a lot of us have had to accept drops in income, and some have lost jobs entirely.

Any unexpected changes to your day to day life can cause anxiety and stress, but especially when these changes are related to money and finances. This article will outline some of the things that you can do in order to manage and reduce any increased stress that you’re feeling because of your financial circumstances.

1. Get organised

Money anxiety and stress can come from not fully understanding your financial situation or knowing exactly what you’ve got coming in and going out; and this is typical for a lot of people right now.

If your income has temporarily changed because of the pandemic, it’s important to ensure that you know exactly what you’ll be paid over the next couple of months. Add this to a spreadsheet along with all of your bills, direct debits, and standing orders so you can see what you’ll be spending too. The difference between the two will give you the amount you can spend on groceries and essentials, and how much you can save.

Even if your financial situation isn’t currently at its best, just having things organised so you can make a plan and any required adjustments should help you to feel a lot more comfortable and settled.

2. Create a budget

Any financially savvy individual should be operating with a budget anyway, but this is especially important if you’re going through a difficult time. This point falls in line with the previous one - anything you can do to get organised will really help to tame the anxiety and stress you’re feeling.

Once you’ve got your spreadsheet of income and outgoings together, this can be used to budget what you can save every month and what you can spend in each category, like groceries for example. When you’re creating a budget, you need to be strict but also realistic; there’s no point setting yourself savings goals that are completely unachievable as a slip up in one area of your budget can shift everything else too.

Don’t worry if you’re not currently able to save as much as you would like to, or if you have to scrimp more than usual in some areas, this is just a temporary budget to get your finances back in order and hopefully you’ll be able to adjust some sections when your income improves.

3. Re-build your emergency fund

I think the pandemic has made a lot of people realise just how important it is to have some spare cash in savings.

If you haven’t got an emergency fund, or the pandemic has forced you to use the one you had, then you need to focus on building this back up. Not having enough money to cover emergencies such as car repairs, dentist or health costs, or a broken washing machine, can cause a lot of stress and anxiety.

Save as much as you can every month and start with a goal of saving a total of £1000 as this will cover most vehicle repairs or dentist costs. Then you should try and work your way up to about three to six months’ worth of outgoings (incl. rent/mortgage payments, bills and food) so you’re covered for a few of months if you have another sudden drop in income or you lose your job. Being able to rely on savings instead of credit cards or loans will be much better for your financial situation in the long-run, and it won’t cause any further anxiety as it would if you end up going into debt.

4. Track your progress

This may not sound like a direct way to deal with your financial problems but tracking your progress can do wonders for your overall well-being and attitude towards money. This can be in the form of a physical chart that you update whenever you add money to your savings, pay a bill or make a contribution towards debt repayment. Being able to see the progress you’re making will make it feel like you’re really getting somewhere and will motivate you to keep going.

5. Talk to someone

So many of us keep financial worries to ourselves and carry the burden on our own. I can’t stress enough how much it can help to talk to someone about your finances if you’re struggling and having issues. If you don’t have a partner or a close family member or friend you feel comfortable talking to then go to a financial advisor or debt specialist. Number one, this will make you understand that you aren’t alone, especially now when there are so many people going through the same thing. And number two, someone else can help you to work out a budget, debt repayment plan and savings plan if you’re struggling to work these things out alone. After all, a problem shared is a problem halved.