Overcoming financial anxiety

Feeling anxious about money is perfectly normal and we understand it’s not always easy to talk about your financial situation. When you suffer from money anxiety, it can feel like the stress will never end.

A recent study conducted by the Money and Pensions Service found that 29 million adults don’t feel comfortable talking about money and that money is currently a daily worry for nine million UK adults.

Even though it can feel overwhelming, there are plenty of ways to stay on top of your finances from creating a budget to starting a rainy-day fund which can shake off the money stress and start down the path towards achieving your financial goals.

Here at Novuna Personal Finance, we’ve put together some of the easiest tips to get you back on your feet and on top of your finances.

Build an emergency fund

An emergency fund (also known as a contingency fund or rainy-day fund) is money that has set aside in case of unexpected expenses or financial emergencies e.g., losing your job or emergency dental treatment. Having this money readily available without having to take out a loan or make a difficult financial sacrifice will prevent an already stressful situation becoming worse.

The best way to start building this type of fund is to set aside an affordable percentage of your income every month and deposit it into a designated savings account. Having a minimum of three months’ worth of basic living expense (include all bills, necessities, and travel) is recommended however the more you can save the better.

Create a budget

Having a realistic budget is a great way to keep yourself in check when it comes to spending and living within your means. Not only will this prevent living month to month or racking up unnecessary debt, but it will also help you achieve bigger financial goals such as getting married or saving for retirement.

The key to managing your budget successfully is to be honest with yourself calculating your monthly take-home pay and monthly outgoings. Understanding where your money goes will allow you to reduce overspending in areas that are unnecessary such as frequent meals out or spontaneous purchases and reallocate it more important things such as your emergency fund or loan repayments.

Regular maintenance on your budget will help you keep on track and ensure that you can make adjustments as and when you need to.

Get a financial advisor

There’s no shame in seeking out professional support if you feel that you need guidance to make the right financial decisions to suit you. Whether that’s to save money to help your children through university, build a retirement pot or to just get back on track.

Depending on your bank, they may offer you a free financial advice service or alternatively there are plenty of independent advisors who cater to your individual budget. Regardless of your current financial situation, they will be able to help you identify your goals, set up a development plan and support you in taking back control of your money.

We do recommend that you spend a bit of time researching your chosen advisor to ensure that they are legitimate and that they hold all the correct qualifications.

Stay up to date on your credit report

Your credit report influences big life events such as getting a mortgage or taking out a personal loan, but it can also impact smaller things like renewing your phone contact or opening a new current account. If you don’t know what your credit score is or what your credit report says, this can trigger financial stress and money worries.

Keeping an eye on your credit report can reduce your anxieties as you’ll be able to monitor your spending, see how much you owe creditors and what your credit score is – you might even be surprised that its better than you expected. The best part is that you can see all of this for free by using credit agencies such as Clear Score, Experian, or Credit Karma.

The benefits of building up and maintaining a good credit rating will help you get the most competitive APRs, save you money on insurance and even just boost your confidence with money.

Money Worries: Advice and Support

If you find yourself in a financial situation that you’re struggling to manage, don’t be afraid to speak up and contact your lenders for support. Our team at Novuna Personal Finance will always take your individual circumstances into account to reach the most suitable resolution that works for you.

There are also a wide range of debt advice charities and not-for-profit organisations who offer free and impartial advice such as Step Change, The Money Advice Service and the National Debtline.

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