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Do you often find yourself stressed over finances? If you do, you’re not alone. In a 2023 study by PricewaterhouseCoopers, around 57% of Americans consider finances to be the biggest stressor in their lives. With many throughout the world living paycheck-to-paycheck, these findings aren’t too surprising. So what can you do to manage both your finances and your mental health?

There are lots of strategies and tips you can follow to manage your stress, especially when it comes to finances. By following these, you can become more at peace with where you are financially and recognize resources and outlets you can turn to for support.

Analyze Your Budget

Your budget is always a great place to start when looking over your finances. Take a look at your checking and savings accounts and monitor your transactions for 3 months’ time. Have any of your bills significantly increased? Are you spending more than you typically would in a given month?

Consider using Excel or a similar platform to lay out your budget. If there have been any changes, such as an increased or decreased bill, account for these. If you find yourself spending more than you would in a normal month, cut back on unnecessary expenses, like entertainment or dining out. On the other hand, if you find yourself with extra money, resist the temptation to spend and move these funds into your savings account.

The 50/30/20 Rule is a great format to follow for budgeting. This rule states that 50% of your monthly income should go towards your needs, such as housing or rent, groceries, and bills. 30% then goes towards your ‘wants,’ or unnecessary spending such as entertainment. The remaining 20% would then go into your savings.

Bolster Your Emergency Fund

An emergency fund could be the peace of mind you need when it comes to your finances. This safety net, also sometimes called a rainy day fund, is money set aside for any emergencies you may find yourself in. This could be an unexpected car or home repair, a medical emergency, or money for when you are out of a job.

Experts recommend you have three to six months’ living expenses in your emergency fund. While that may sound ambitious, you can absolutely meet this goal by sticking to your budget. Consider automating your savings and having these transfers happen as soon as you get your paycheck, so you’re paying yourself first.

Seek Financial Counseling

It’s common to become overwhelmed with your finances, especially on top of all life’s other obligations. Don’t be afraid to seek financial counseling for advice and to take in a full view of your finances. Financial counselors can recommend strategies you can follow to pay off debt, better manage your finances, and save for long-term goals like retirement.

Here are some questions you should ask financial counselors before coming to a decision on who is the best fit to help you:

• What are your qualifications?
• What services do you provide?
• How will you communicate with me? And how often will we communicate?
• What are some financial trends you're monitoring in 2025?

Once you’ve settled on the financial counselor you’d like to meet with, review your goals with them. Ask additional questions that pertain to your exact financial situation. Working with a financial counselor is a great sign that you’re never alone in your financial journey.

Set Small and Achievable Financial Goals

Whether it’s purchasing a first home, a new car, or building an emergency fund, we all have financial goals we’re building towards. And while it would be beautiful to wake up tomorrow and accomplish these goals, the truth is that they take time. To maintain peace of mind and not become overwhelmed with your goals, consider making them smaller and taking them step-by-step.

Let’s say you want to purchase a home. There are lots of smaller goals that can build towards your end goal of getting your keys. Some of these could be putting money aside each paycheck to save a set amount for a down payment. Another could be setting aside time each week to explore housing grants or first-time homebuyer programs if this will be your first home.

Be sure to celebrate the small victories when it comes to your finances. With more manageable goals, you’ll become more satisfied throughout the process and feel successful in your achievements.

Automate Your Finances

You can relieve some of your stress by automating your finances. Most financial institutions have automation built into their online banking and mobile apps where you can have a portion of your funds disbursed to another account. This is a great option for moving money into your savings without even having to think about it. In a way, you’re paying yourself first!

Bills are another great option for automation. It can become incredibly stressful needing to log into various websites to pay your bills as they’re due each month. With automation, you avoid these headaches and know your payments are made on time.

Keep Spending in Check

When you’re feeling overwhelmed or anxious, especially about your finances, it can be easy to fall into impulse buying. This is the act of making purchases on a whim, without factoring it into your budget or actual needs. Routine impulse buying can get costly and is a habit you should avoid as much as possible. Remember to stay disciplined and stick to your budget.

Revenge spending is another dangerous financial habit to fall into. This occurs after a period of economic hardship, where you overspend on something you felt was taken away from you during that period. The COVID-19 pandemic is a great example of this—perhaps you felt inclined to splurge on an extravagant vacation, something you wouldn’t necessarily have been able to do in 2020 or 2021.

While there’s certainly nothing wrong with treating yourself to something nice every now and again, remember to monitor your spending habits and avoid these pitfalls as much as possible. The true reward will be achieving your long-standing financial goals!

Don't Be Afraid to Seek Help

It is entirely normal to feel overwhelmed with your finances. But sometimes these feelings of anxiety stretch beyond strategies and tips to best manage your money. With May being Mental Health Awareness Month, now is a perfect time to check in on yourself. Never be afraid or discouraged to seek professional help with a therapist or counselor to manage your anxiety or other feelings. Your mental health is truly your most valuable asset.

Let Us Help You

Here at American Heritage, we’re proud to offer a variety of financial resources to help you achieve your goals. Our Learning Center hosts a variety of webinars, blogs, calculator tools, and more to help keep you on track with your goals and learn strategies to best manage your money. Representatives from our Investment & Retirement Center are also available to provide guidance and advice.