It happens so quickly; you might not notice it. Over a few weeks—an unexpected repair here, a quarterly payment there—and suddenly you feel like you’re underwater. Again.
While security can mean different things to different people, generally it's having enough money to cover your expenses, live comfortably and set aside some savings. It sounds simple but can be hard to do.
Yet no matter your earnings, there are ways to ease financial stress. And it’s not about just making more money. These practical tips can help you hold financial stress—no matter what your earnings—in check.
Real harm results from financial stress, though it may take years to show up.
Recent research from University College of London (UCL) found financial stress is the most harmful to your health. It’s dangerous because it can lead to higher blood pressure, heart issues, even diabetes. And it can lead to depression.
Most of us can’t count on winning the lottery. But there is a proven path to financial peace, long before you give up lattes or work extra hours.
Build a resiliency fund. Call it what you want—a “rainy day” fund, your “mad money,” or just an “emergency” fund.
The key is that it is money that you can tap for emergencies or otherwise. Why is such a simple thing so powerful? There are two reasons:
It doesn’t take much. A recent Fidelity study looked at people’s finances, particularly women’s. “Stress” was the top word women used to describe their financial situation. Of those with no emergency savings, 81% reported a lot of stress. Once three months’ worth of cash reserves were built up, stress levels fell to 26%.
Even one month of cash reserves helps. You can go further with these actions:
Mercer Indigo can help you shop for more affordable options for the bigger bills in your life—insurances and other risk protection—to help you ease money stress. Use it to compare rates from leading companies to find the best solution for you.