Financial Stress: “Little by Little, a Little Becomes a Lot”

Financial stress is so common in our lives with the cost of living crisis and the rising inflation. This month is Stress Awareness Month, and this year’s theme is “Little By Little, A Little Becomes A Lot”. This is the idea that small actions each day contribute to your overall well-being in time. Stress is something that can have a huge impact on people’s lives in so many different ways. There are lots of reasons why we get stressed and with Stress Awareness Month in mind, why not focus on a huge one – money!

The Impact of Finances on Our Mental Health

Financial stress isn’t just about money – it’s about the effect it has on your mental and emotional well-being. It could be the constant worry about bills, the fear of losing your job, or the burden of debt. Whatever it is, financial stress can find its way into every aspect of your life. Once it does, it can put a strain on your relationships and stop you from enjoying life to the fullest. It’s a silent struggle that affects millions, but it’s also a challenge that can be reduced with the right tools and mindset.

Whilst the COVID-19 pandemic may seem like a distant memory, the aftermath of the the nationwide lockdown led to an unpredictable level of financial stress. With lots of job losses, an unstable economy, and disruptions to everyday life, many of us found ourselves under financial strain

Research from the Money and Mental Health Policy Institute shows that in England alone, there are over 1.5 million people experiencing problem debt and mental health problems. 86% of those with experience of mental health problems said that their financial situation had made their mental health problems worse. These numbers alone show how much of an impact money can have on our mental health.

Whilst this all sounds a bit doom and gloom, there are lots of strategies that can be used to overcome all this stress.

Strategies to Overcome Financial Stress

Financial Literacy: Knowledge is Key

A lot of us went through education without ever being taught how to understand a payslip, how to budget, and how to save for an emergency fund. These are all things that are crucial to managing your money effectively. 

One of our surveys showed that 80% of 18-24-year-olds are not confident in their own financial knowledge and money management skills. Clearly, these skills are not taught at a young age, and so the best first step to take in overcoming financial stress is to boost your financial education. 

Just start reading up on some essential skills like budgeting, saving, investing, and debt management. The more you understand about how money works, the better you’ll be able to make informed decisions and work through financial challenges confidently.

If you don’t know where to start, we write tonnes of blogs about lots of different topics. If you are a bit more of a listener than a reader, we have our Pocket Perspectives Podcast hosted by Jack and Tinisha. They cover everything from understanding your taxes to completing fun savings challenges. Remember, start small and don’t overwhelm yourself.

Budgeting: Planning your Financial Future

One of the easiest ways to lay out all your finances and see exactly where you stand, is to create a budget that fits your situation. Track your income and your expenses in whichever way suits you. That could be on a notepad, or using an online system. For example, at IE Hub, we offer a free-to-use budgeting tool that you can fill out and update whenever you like. 

It is important when budgeting to prioritise all your essential spending so that you can see exactly where you stand. Do you have enough money to cover your expenses? Do you have some money left over? A well-made budget is the best way for you to plan out your finances and help you stay on track with all your goals.

Build an Emergency Fund: Your Financial Safety Net

We have written a whole blog post talking about the benefits of an emergency fund and how to get started in setting one up. To summarise, having this safety net is so important in case anything ever happens that is out of your control.

Your car needs a new tyre? Great you have £150 set aside in your emergency fund. 

Your boiler needs to be repaired? No problem! You have your emergency fund. 

Even if it doesn’t get used for a whole year, that financial cushion gives you the peace of mind to know you are covered if any financial emergencies ever happen. That’s one big tick when it comes to overcoming financial stress.

You don’t have to start saving half of your payslip every month for an emergency fund. In the spirit of this years Stress Awareness Month theme, start by saving a little bit each month. Then build this up until you start seeing a hefty emergency fund coming together.

Seeking Support: You Are Not Alone

An important thing to remember – it is likely that some of your friends and family and the people around you are going through the exact same worries. 

You do not have to face financial stress alone! Talk to your friends, talk to your family, talk to your work colleagues. They might have some tips of their own to help you through whatever you are going through.

Not only that but there are professionals out there. Here are just a few of the places you can go:

• StepChange Debt Charity: They offer free debt advice and help create manageable repayment plans.
• The Money Charity: They’re all about financial education, with free workshops, guides, and tools.
• Turn2us: Providing financial support and benefits advice for those facing hardship.
• Shelter: Offering advice on housing-related financial issues, from rent to mortgages.
• GamCare: Offering advice and support for anyone affected by gambling harms.
• Scope: Providing practical information and emotional support when it’s most needed for those with disabilities.
• Money Wellness Group: They are all about improving your financial well-being. They offer free advice and support to help you
  live more and stress less.

For more help and support resources specific to your situation, head to the Help and Support tab in your IE Hub customer journey. This is a bank of helpful, judgement-free places to go for help for a range of problems.

Help From IE Hub

One of the features that we are so proud of at IE Hub is the ability to share your budget with your creditors. Sometimes just the thought of calling every one of your creditors and debt providers is enough to make you scream. 

When you budget with IE Hub and want to share this information with your creditors, you can just click share. Then you just wait for them to get back to you and arrange a payment plan. This takes such a huge stress away from you if you are juggling lots of debts. 

You might even be entitled to some benefits that you were not aware of. You can check using our free benefit checker tool! 

The overall message to consider, is to acknowledge the significance of overcoming your financial stress. You do not have to go all in all at once, take it one step at a time. Maybe gain some more financial knowledge, and then start embracing some of the strategies like budgeting. And finally, don’t suffer alone, there is so much support out there!