Finance-related anxiety is, unfortunately, a feeling with which many of us will identify. Extensive research shows that these worries affect us well beyond the workplace itself; if anything, we may worry more about our wages once we’ve clocked out for the day.
Poor financial wellbeing can have serious implications for our general wellness, affecting our mental, physical and emotional health, as well as impacting our relationships with others around us.
The numbers speak for themselves. Salary Finance’s report for 2019-2020 found that employees who are worried about their financial wellbeing are 4.1 times more likely to suffer from anxiety, 4.6 times more likely to be depressed and 14.6 times more likely to have sleepless nights.
These figures show a stark impact on our overall health and, while there’s documented causal relationship, many of us can attest to the fact that financial wellbeing and overall wellbeing are closely linked.
As the mental health charity Mind aptly puts it, “poor mental health can make managing money harder and worrying about money can make your mental health worse”. Mind identifies the wide-ranging effects money worries can have on our wellbeing, from the inability to afford essentials such as food, rent and required medication, to working ourselves to the point of burn-out in a job we feel trapped in.
Beyond the most obvious, there are myriad ways that financial stress can deteriorate our overall wellness. Working over-long shifts to earn enough to cover the basics can mean no time for real eating, exercising or sleeping routines; perpetual, underlying stress about money can boil over into arguments with family and friends; an inability to earn and save as much as we’d like can negatively impact our own self-esteem.
If you are regularly preoccupied by the reality of your bank account, you’re most certainly not alone: Salary Finance’s report for 2019-2020 shows that 36% of UK employees are worried about their finances. Many of us might assume that the 36% is concentrated among lower earners, but the fact is that financial worries don’t simply become a thing of the past as we gain promotions and raises.
Our financial wellbeing has a direct relationship to how we borrow, spend and save, rather than with how much we actually earn. A recent survey showed those earning under £10,000 and over £100,000 are equally concerned about money: 46% of both groups reported feeling stressed.
For employers, these are stark facts to reckon with. The same survey shows that employees with ongoing financial worries are 8.5 times more likely to report that it affects the quality of their work and 12.4 times more likely to say it stops them from completing their daily tasks. So it’s not just lower paid employees who underperform because of money troubles; it’s the employees at the top of the corporate ladder too.
Of course, the ongoing Coronavirus pandemic has worsened money worries across the population. While being furloughed may have come as a sweet relief to some, households where both earners have seen their salaries reduced may well be in financial hot water. Widespread redundancies have also placed obvious stresses on workers’ finances, possibly exacerbating pre-existing money worries.
The good news is that there are concrete moves you can make to improve your financial wellbeing. Creating lasting change doesn’t need to be overwhelming: the key thing is to take it one step at a time, prioritising your overall wellbeing in the process.
Here are three small steps you can take to start the process:
- Create a system for tracking your month to month finances. There are some great apps that help you do this but if not, a trusty spreadsheet is just as good. Use the information you glean from this to see where you could optimise your spending by perhaps putting more into a savings/investment account or towards paying down any debt. Always remember to pay yourself first!
- Set realistic monthly budgeting goals so that you are in control of your money rather than your money controlling you.
- Talk things through with a trusted friend or family member to ease the mental burden and help you clarify your next steps. Even better, they could end up acting as an accountability partner too to increase your chances of achieving your goals.
And of course, if you would value professional financial advice as well as education on personal finance tailored specifically for women, rainchq is here to help.