For most of us, when we think about money, our initial feeling isn’t always joy. Sometimes, it’s more like the orange Anxiety character from Inside Out 2.
I am no different, I can vividly remember being 22 at a bar and waiting until 12:01, when my direct deposit hit, to close out my tab. When did drinks with girlfriends get so expensive?!
Fortunately, since then, I’ve made a bit more money, gained a lot more knowledge, and have even created Your Rich BFF, a financial equity platform that helps teach people how to better save, spend, and invest their money.
Still, I can be my own worst enemy when it comes to financial anxiety. In my experience, financial anxiety often happens when we feel alone, helpless, or have to make too many hard decisions in quick succession. The result: Freaking out about how much money I have, what I’ll need in the future, and what could go wrong.
But I also know how to avoid the pitfalls of financial anxiety so that Today You can take care of Future You. With a few tweaks to your routine, you can start to see your finances as a source of comfort and stability instead of stress and anxiety.
Here’s how I tackle my own financial anxiety, and how you can too.
Practice value-based spending.
Value-based spending means calculating how many hours you’d have to work to pay for something (the price/your hourly wage = your hours of labor), and using that to determine how valuable the thing is. Instead of judging purchases by their sticker price, you’re thinking about it in terms of your labor.
This isn’t to discourage yourself from spending on something you really want. Instead, the goal is to add more context to how much things are worth. When you know how valuable your time is, you can feel good spending money on things that seem worth it.
For me, practicing value-based spending curbs financial anxiety by taking the guilt out of spending! When I know something is worth my money, I can buy it with joy. And, on the flipside, it’s easier to pass on purchases that would give me buyer’s remorse later.
Here’s how to do the math. If you are salaried, calculate your hourly wage by dividing your salary by 2,080 (40 hours a week x 52 weeks = 2,080). If you’re paid hourly, then you already know.
Then, divide the cost of whatever you want to buy by your hourly wage. That’s how many hours you’d have to work to pay for that thing.
For example, if you make $20 an hour, but want to buy a pair of $80 leggings, that’s four hours of work. Worth it? Maybe!
Automate your deposits.
In my early 20s, I would spend every dollar I saw in my account because I knew I had it. When that mentality ultimately led to overdrafting on my account, it created a ton of financial anxiety. Plus, I got hit with extra fees that I certainly could not afford!
When I started splitting off my dollars and had a smaller balance in my checking account to stare at, I naturally spent less. But, in reality, Current Vivian was setting Future Vivian up for success.
If you have a traditional W-2 job, you can set up your direct deposit to divide your paycheck up into different accounts: a little in your 401k, your savings, and your checking. An easy way to start saving? Automatically put 90% of your paycheck into checking and 10% into savings, rather than just having your entire paycheck dumped into one bucket.
Focus on collaboration.
I, like many women, have been peddled the lie that there can only be one woman at the top. It's you or the woman next to you, but never both. But the reality is, you never see two guys named John fighting over who gets to join the C-suite. They know that they can both make it. And frankly, if they play their cards right and work as a team, they might get there faster together.
I noticed my anxiety around money and success lessened meaningfully after focusing on collaboration rather than competition. Instead of constantly comparing myself to others when I felt lost, I asked for advice. I received a lot of wisdom and leveled up my relationship with money by leaning on my network!
Collaboration is key at work, in school, and in your personal life. If you surround yourself with folks with that same mentality, you’ll start to notice your crew is all leveling up together. Afterall, if we're always seeing everything as a competition, we're probably going to feel worse about our financial situation in general.
Don’t succumb to debt anxiety.
Debt is one the biggest and most paralyzing causes of financial anxiety. How can you prepare for the future when you feel a literal weight over you?
Anxiety can paralyze us. When things feel overwhelming, it can be easier to stick our heads in the sand and do nothing. But if we want to get things done, we need to act! That’s true for debt too.
First, debt isn’t something to be ashamed of or anxious about. Second, the avalanche method can help you get started paying it down. Here’s how to do it: First, be sure to make the minimum payment on all of your debt. This is the least amount you can pay without being penalized.
Then, sort your debts from the highest interest rate to the lowest. When you have extra money, put that towards the debt with the highest interest rate. This way, you’ll pay down the debt that grows the fastest first, and leave that financial fear behind.
Talk to your partner about money.
You might be romantically aligned, but are you financially aligned? That can cause a lot of money anxiety, especially if you’re unsure how your partner spends, what they actually make, and the value they place on money.
If you and boo don’t get on the same page financially, not only will you feel anxious about money, but you might even just feel anxious around your partner and start tiptoeing around subjects that may cause discomfort.
So how do we financially connect with a partner? Set a standing monthly money date! Order a pizza, play some fun music, and review your past spending and future goals. Maybe one of you is focused on paying down debt before getting married. Maybe you want to set a savings goal to buy a house. A money date can help you get and stay in financial alignment with your partner for the long term.
Address the friendship wealth gap.
Talking about money isn’t just for your romantic relationships. You might feel anxious seeing friends go on lavish vacations and spending big while you’re grinding away at work.
Feeling a need to keep up is real. If you don’t have a curated Instagram feed of vacation pics, you might assume your life sucks. That’s certainly how I felt when seemingly everyone I knew was in Mykonos one summer. (Genuinely, was everyone in Greece at the same time?!)
Opening up money conversations with your friends can help set realistic expectations. You might also realize that you’re not comparing apples to apples after you have a peek behind the curtain. Turns out, your friend’s parents are paying their rent (that’s why they can afford so many designer shoes)! Or maybe your friend makes twice as much as you thought, which explains the fancy vacations (maybe that friend has good advice for increasing your pay too).
If you need an intro to talking about money with your friends, try an easy topic first. Maybe it’s the New Yorker in me, but I’ve noticed it’s common for folks to discuss their rent. What do you spend? What do your roomies spend? Then you can move on to harder stuff like salaries, parental help with finances, and any debt.
Money can make a lot of people very anxious, but the best way around this fear is to talk about it. When we work together, open up together, and collaborate together, we can level up our own lives and those around us.
Wondermind does not provide medical advice, diagnosis, or treatment. Any information published on this website or by this brand is not intended as a replacement for medical advice. Always consult a qualified health or mental health professional with any questions or concerns about your mental health.
