Three ways to immediately ease the pressure around money
Tackling money worries can feel daunting, but it’s important to do it sooner rather than later. Quilter personal finance expert, Rio Stedford, explores three easy ways people can take control of their finances to help ease anxiety and support their mental health:
1. Talk to someone and seek help if you need it
“Our personal finances can often be viewed as a sensitive, private topic, but it is vital to open up and ask for help if you need it. Anxieties around money can be a huge burden to carry alone, and you don’t need to. There’s a great deal of help available and speaking to someone about your concerns is often the best place to start."
“While discussing your worries with a trusted friend or family member can be helpful, there is also a wide array of financial guidance and support available which can be very beneficial. The Government backs several key services such as MoneyHelper, as well as charities such as StepChange and Citizens Advice – all of which offer free support.”
2. Create a budget and stick to it
“The cost-of-living crisis has seen our everyday spending increase significantly, which can be overwhelming. If this is the case, it is important to get back on top of things."
“Creating a budget can make a big difference when it comes to taking control of your finances as it will allow you to see exactly how much you spend, where you spend it, and if there are any areas you could cut back. There are many free online budget planners that will help you get started."
“While creating your budget, it’s a good idea to take stock, review your expenditure and reprioritise. For example, many subscription fees have increased in the last few years so take this opportunity to ensure they are still meeting your needs. Often you will be able to switch to a better deal to help reduce costs, so it is worth taking the time to shop around.”
3. Manage your debts and boost savings where possible
“Having an emergency cash savings pot to fall back on is very important, particularly when our finances are stretched more than usual. However, before you look to start saving you should aim to ensure any debts are paid off, beginning with those with the highest interest rates. Debt can have a negative impact on your mental health, so you should address these issues as soon as possible to help reduce stress."
“Once you have settled any debts, look to boost your cash savings where possible. The cost-of-living crisis may make it more difficult to put money aside but having some cash in reserve is critical as it provides a buffer to fall back on should you need it. Even if you can only save a small amount each month, something is always better than nothing.”
“If you have an adequate pot of cash saved, such as 6 month’s net salary, you may wish to consider investing for the longer term. With inflation currently at historically high levels, the purchasing power of cash savings will effectively decrease over time. An ISA can be an excellent, tax-efficient option for your savings, and you can choose between saving in cash or investing in stocks and shares.”
“For those who can put some money away for the longer term, a stocks and shares ISA can be a great way to take the first step into investing which aims to provide a better long-term return than you may be able to achieve with cash savings. There are many off-the-shelf, ready-made diverse portfolios to choose from that are designed to align with how much risk you want to take, so it is worth exploring the options available to you. As with all investing, the value of your investment and any income from it can fall as well as rise. You may get back less than you invested.”
Mental Health Awareness Week runs from 15 to 21 May. More information can be found here.
