Many of us are reeling from what’s been happening in our world right now. Social distancing and self-isolation have taken over our lives, and although social media and technology keep us connected, they can't replace human interaction.
On top of this, we’re heading into an economic downturn. Financial worry is normal when a recession hits, and although much has been done by our government to help us prepare us, we’ve never lived through a pandemic and no one knows what will happen when it’s over.
This has caused a lot of stress and uncertainty. In both my client and personal conversations, I’ve uncovered a theme: anxiety. It’s been compounded by the overwhelm of people impacted by CODIV-19 and the incredibly quick social adjustments we’ve all had to make.
I do know, however, that it will pass, and those who used this time to prepare and focus on what they can control will come out on top. When it comes to your finances, I’m here to help.
Here are 5 ways to reduce your financial anxiety right now:
It’s normal to have mixed emotions about what’s happening, but know that you have a choice in this time of uncertainty. You are going to feel fear, anger, and frustration, and yes, you may be stressed as well. Give yourself space to experience these emotions, but don’t let them overrun your thoughts. Take a deep breath and know that you are going to manage through this difficult time and make a promise to yourself that you’re going to do your best to manage it. You are in control of how you react to the situation, and as a result, how you take action.
The first thing you need to do is know exactly where your cash is going. If you don’t have a budget to review, you’ll have to reconcile your expenses. Don’t worry, this is not as horrible as it sounds. You need to get to the truth of where that cash has been going in order to assess the situation, right?
Download my 7-minute money hack to get clarity on your cash flow. The tool says to use one month’s of credit card and bank transactions, but it’s best that you go back about three months to get the most accurate number (this is going to take you longer than 7 minutes now, but trust me, it will be worth it.)
I have only one rule for this exercise. As you go through your expenses, ask yourself what purpose the purchase served you, and how did it make you feel? If there’s any trace of guilt – cut it. But if it made you feel good and it brought joy to yourself or someone else, then consider keeping it.
Take a closer look at those subscriptions, unnecessary phone features, and extended cable services. Gym memberships that never get used, magazines, online games…they’re all up for grabs when it comes to cutting expenses.
When it comes to gifts and dinners out, it may be time to either reduce the number of parties or come up with creative ways to celebrate with others. Social distancing has reminded us how much we enjoy one another’s company, and the idea of reducing that joy will just end up making you resentful. Just be cautious and know your limits here.
If you carry a high debt load, now is the time to call your credit card provider and ask for a new interest rate on that debt. If possible, you may want to consider consolidating the debt as well. If minimum payments are all that can be made at this time, that’s ok. Don’t miss them as you’ll end up impacting your credit score.
With the severity of the economic downturn, the banks are working on a client by client basis to discuss mortgage payment plans and terms. If you find yourself unable to make your next mortgage payment, call your bank to speak with them and negotiate a payment plan that fits your budget.
The economic response plan from the Federal government has been swift and they’re ensuring that no Canadian gets left behind. The emergency care benefits and EI (employment insurance) payments are now available and can be applied for online. Visit www.canada.ca for details as they continue to update with each passing day. Each province has also released information on financial aid, which varies depending on your province. Be sure to check online for more information.
Individual tax filings have been delayed to June 1, 2020 (instead of April 30, 2020), but if you believe you’ll be receiving a refund, I suggest filing before the new deadline as that money can be used to help pad your emergency fund.
How are you feeling now? If you’ve got momentum, don’t stop! There has never been a better time to implement healthy financial habits that will serve you well for life.
Do you know your net worth? This is a good financial snapshot that you can update annually ad track your long-term financial goals. Not sure how to get your net worth number? Download my free copy here in the Money Library, save it to your desktop, and update it annually.
Have you been meaning to get that Will done? I know, it’s not a topic anyone likes to think or talk about but trust me – your loved ones will appreciate it. Willful is a complete online shop where for as little as $99, you can create a notarized Will. Bonus: if you use this link you’ll get an additional 20% off as well.
Curious about investing and ready to start? I’m hosting a free webinar on March 3oth at 7:30pm called Women Building Wealth where I’ll be debunking common investing myths and sharing investment strategies in plain English, so they make sense. No jargon, no judgment. Join us! You can register here.
We’re in this together. If you’re still feeling anxious or have ongoing stress that you can’t control, please speak with someone. I am convinced that this experience will serve as a reset for many of us and give us a chance to focus and gain clarity on what’s most important in our lives, and I am confident that we will all come out stronger on the other side.