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10 Strategies to Reduce Money Stress and Improve Your Finances

You can can have money stress and feel anxious about your financial situation, no matter how much you make. Find out the root causes of money stress and 10 strategies to reduce it so you can have a more peaceful life.

By
Laura Adams, MBA,
March 14, 2018
Episode #535

10 Strategies to Reduce Money Stress and Improve Your Finances

Many people mistakenly believe that if they just had more money, all their stress would disappear and they could finally be happy. In some cases, earning more is the solution to improving your financial health or dealing with a hardship.

But what’s surprising is that you can feel anxious about your financial situation, no matter how much you make. Oftentimes, having more money just causes you to inflate your lifestyle in a way that doesn’t reduce stress or bring you more long-term happiness.

In this post, you’ll learn what’s at the root of money stress, and develop ten strategies to reduce it and have a more peaceful life.

10 Strategies to Reduce Money Stress 

  1. Adopt a new money mindset. 
  2. Focus on the positive in your financial life. 
  3. Radically cut your expenses. 
  4. Make saving automatic.   
  5. Get a handle on your debt. 
  6. Create additional sources of income. 
  7. Stop caring what others think. 
  8. Stay informed about your finances. 
  9. Take a stress break. 
  10. Get professional help.

Consider what’s causing money stress in your life and how to use each of the above strategies to reduce it. We'll look at each in detail a bit further below. But to start...

What Causes Money Stress

Stress is nothing more than your body’s response to a situation or a series of events. Think about a stressful situation, such as hearing the fire alarm go off in your office building or seeing a tornado barreling toward your neighborhood.

Some people would react by hyperventilating and other people keep calm and in control. The situation is the same for everyone, but the way each person perceives the situation is very different.

There are a few common stressors that can cause money stress. Understanding and avoiding them is the secret to achieving more with less anxiety.

One widespread problem is living above your means, which is when your living expenses exceed your income. You finance your lifestyle using some form of debt, such as a credit card, loan, or home equity line of credit. Or you might drain your savings or retirement account to pay your bills.

If your finances go in the red every month, or you’re living paycheck to paycheck, you can’t get ahead of your expenses and build wealth for the future.

If your finances go in the red every month, or you’re living paycheck to paycheck, you can’t get ahead of your expenses and build wealth for the future. Knowing that you’re going backwards or just treading water can cause worry and financial stress. 

For some people, owing any amount of money can be a source of stress—even if you’re meeting your expenses and diligently saving for the future. High earners can feel anxious if they have a complicated financial situation that’s gotten out of control.

This can happen when you’re unorganized, have too many accounts, begin managing your finances for the very first time, or don’t have a clear financial plan to achieve your goals.

10 Strategies to Reduce Money Stress and Improve Your Finances

While money stress or anxiety may never completely disappear from your life, reducing it as much as possible can improve your relationships, health, and general sense of well-being. Use these 10 strategies to stay calm, think clearly, and work on solutions to your financial challenges.  

1. Adopt a new money mindset.

For many, financial stress comes from projecting a worse-case scenario into the future. You can exaggerate a situation in your mind to the point that your heart starts pounding and your palms start sweating. 


Remind yourself that you’re not in the future—you’re in the present moment where you have the power to make a difference. Choices always exist to take control and improve any financial problem. 


Actions are always preceded by thoughts and beliefs. So, reframe how you think and speak about your finances.

Never say that you can’t increase your income or that you should cut your spending. Instead, say I want to increase my income or I will cut my spending. A shift in your language is the first step to a shift in your mental attitude. 


Never believe that a financial challenge is a sign of personal failure or weakness. Whatever your situation, millions of people have struggled with the same thing. You and your family can grow stronger by proactively working through your money challenges.

See also: 14 Tips to Stop Impulse Buying and Save Money

2. Focus on what's positive in your financial life.

Though it may sound cliché, keeping a positive attitude and using positive language can reduce your stress response to financial problems. Instead of dwelling on what’s wrong with your finances, think about what’s going right that you can be grateful for. I promise whatever your situation, there are many people going through tougher times who would love to switch places with you.

Instead of dwelling on what’s wrong with your finances, think about what’s going right that you can be grateful for.

Try keeping a gratitude journal as both an outlet for negative thoughts and a place to write down at least three things you’re thankful for each day. The Five Minute Journal: A Happier You In Five Minutes a Day or the mobile app are perfect tools for a daily gratitude practice.

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