3 Strategies to Stop Stress from Destroying your Finances
HomeBlog3 Strategies to Stop Stress from Destroying your Finances
3 Strategies to Stop Stress from Destroying your Finances
The holiday season has begun. For most people, this time of year tends to result in an increase in both spending and stress. Most of the discussion around this topic is on how spending money increases stress. However, it is important to understand the reverse relationship as well, how stress affects your finances.
It is a common experience for those who celebrate the holidays to have an increase in spending due to buying gifts for family and friends and traveling to spend the holidays with loved ones. Although these expenses are to be expected, since it occurs every year, they are usually accompanied by anxiety about the resulting bills.
However, the increase in stress during this time is due to more than simply an increase in spending. Time can be a significant stressor as people balance work with travel and spending time with family and friends. Errands can increase when buying presents and preparing parties or family gatherings. For some people, seeing certain family members can cause stress. While for others, the holidays can bring up painful memories or be a reminder of those we have lost.
Although it has obtained a negative reputation, stress is not a bad thing. Stress is our survival mechanism. When we are in life threatening situation, stress triggers an automatic response that enables us to fight off danger or run away from it. This is called the fight or flight response.
Imagine our primitive ancestor walking around and suddenly a saber tooth jumps out. The faster our ancestor responds, the more likely they are to survive. So this stress response can happen more rapidly than conscious thought. This stress trigger sets off a chain of physiological changes including an increased heart rate, rapid breathing, muscle tension and other physical effects that allow us maximum energy to fight off the saber tooth tiger or run away from it. There are two other responses to extreme stress, freeze and faint, but these occur far less often.
Although this stress response is highly effective for real physical danger, it is housed in a primitive part of our brain that is not very good at distinguishing real danger from false danger signals. In modern first world countries, there is far less real physical danger and more false danger signals such as a car honking when they are cut off. All these false signals can lead to chronic stress, which is not good for our health or wallet.
High levels of stress mixed with the demands of the holidays can lead to poor financial behaviors which in turn create more stress. When stressed and short on time, people tend to spend more for convenience. This may include eating out more often, paying for faster shipping, or paying for services they would normally do themselves. People who are under stress tend to react without as much forethought and make poorer decisions. They also have less willpower and so engage in poor eating and work habits, which have further negative effects.
It is impossible to completely avoid stress and an increase in spending is expected during the holidays. However, there are some things we can do to reduce our stress to more manageable levels and limit damage to our health and finances.
1. Do one thing:
Although it can be useful to write a long to do list or load our calendar with errands, this can also have the adverse affect of overwhelming us to the point of being unproductive. If you find yourself feeling overwhelmed, focus on just one thing. This should be the most important thing that needs to be done for just today.
Your one thing may be a task that helps you meet your goals in the most effective way. In The One Thing, Gary Keller and Jay Papasan suggest the way to identify the most important thing is through the focusing question “What's the ONE thing I can do such that by doing it everything else will be easier or unnecessary?”
We can take this idea one step further and ask what is the one thing that is most important to you? This can help you focus on your values and put less energy into the things that are not important. Even if you cannot limit your focus to just one thing, you can look for ways to simplify a problem or task to make it more manageable. Although this may take little more time up front, it could have long term pay off for relieving stress.
Chronic stress can drain physical and emotional energy. This deletion can lead to illness, negative mood, and maladaptive behaviors. A key strategy to prevent burnout is to practice self-care. Self-care is any activity that relaxes you and replenishes physical and emotional energy. Universal self-care behaviors include getting enough sleep, eating a healthy diet, and getting regular exercise.
It is also important that you know what works for you as a self-care routine and to practice it regularly. For some people with this may be weekly happy hour, reading novels, spending time in nature, or baking. Make sure to schedule in your self-care like you would a doctors appointment so that it doesn’t get neglected as a result of a busy schedule.
3. Set limits:
Being realistic about what you have the energy and time to do can drastically reduce stress. Sometimes there is simply is not enough resources for all the demands. Recognize that it is ok to say no at times and to set limits with what you are willing and able to do. Be assertive and clear with other people about your limits. This may mean creating a budget, setting spending limits on gifts, and saying no to parties or travel. Although it can be tempting to overspend and over commit yourself, it is not worth letting the stress overwhelm you to the point of ruining the holidays and distracting from time with the people you care about.