Money Anxiety? We Talked to a Financial Therapist About How to Cope
Who doesn’t have the usual money concerns? But in a pandemic, it’s no wonder we’re all losing a bit of sleep. That’s where Amanda Clayman, financial therapist and Prudential’s financial wellness advocate, comes in. Her mantra: With money, financial literacy isn’t enough—you have to understand the emotional side of your spending habits, stressors and more to truly make sense of (and stay calm about) your bottom line. During a pandemic, this is especially important, with money anxiety running extra high. We asked Clayman to treat us like one of her clients and share her best advice as it applies to the most common COVID-19-related financial fears.
Financial Fear #1: “I Lost My Job and I Have No Idea Where My Next Paycheck Is Coming From.”
Clayman’s Take: For one thing, this is totally natural. The best course of action is to acknowledge the fear, but then put your focus into the actions you can take to problem-solve around it. Calculate exactly how much time you have to keep the status quo thanks to severance or savings, etc. Then, you can map out the right amount of anxiety, but also take the appropriate steps to respond to the situation and your circumstances.
Financial Fear #2: “The economy is trending to be as bad if not worse than the Great Depression.”
Clayman’s Take: “Worst case scenario” fear-casting happens, but you need to ask yourself what you want to do with that outlook. For example, are you just repeating the fact that the economy is tanking because you want to be prepared for it? You may be borrowing worries that you don’t need to. “The thing about worst-case scenarios is that they may or may not come to pass,” says Clayman. “Instead, ask yourself, ‘What are some ways that I can prioritize my own safety and security for the long-term?’” This can help you prioritize a more practical approach.
Financial Fear #3: “I was making a dent in my debt pre-pandemic, but now it just keeps getting higher.”
Clayman’s Take: Pandemic or not, debt is a constant stressor. Clayman says the best way to combat this is to focus first on how your money is coming in and how it is going out. “Try to identify what exactly is causing your cash flow deficit,” she says. “Is it that your committed expenses are too high and you don’t have enough left for food and personal needs? Or do you find yourself trying to keep up with people who have more money than you?” During a pandemic, the reasons for the deficit—say, job loss—can be a lot more complicated, but it’s still valuable to reflect on ways you can bring your finances back into alignment. This might require cutting a significant expense (say, childcare) or selling something to cancel out some debt. It’s not easy, but the goal is to be more purposeful about your spending in a way that works instead of constantly berating yourself for something that may or may not be in your control during this time.
Financial Fear #4: “I can’t afford to pay rent and don’t want to have that conversation with my landlord.”
Clayman’s Take: Before your stress levels hit a max over this, you need to do a self-assessment of your financial standing. Can you not pay rent at all? Or just some rent? Depending on the answer, you need to educate yourself on your options. “Once you run the numbers, it may mean that you can’t stay in that apartment, so you’ll need to talk to your landlord about breaking your lease or asking for a rent reduction for a period of time,” she says. Bottom line: Know what you can and can’t afford before you initiate the convo. It’s also smart to know your rights as a renter and identify possible resources such as rent or tenant advocacy groups in your area that could help. Clayman adds that you may also need to recognize there are some things you just can’t control. “That said, preparation can help you combat the anxiety your feeling.”
Financial Fear #5: “I'm so worried about my financial future, I can't sleep at night.”
Clayman’s Take: Never look at financial information late in the day. “Make all your money-related tasks morning tasks,” she says. That said, you also need to take a look at your financial situation and reassess your safety in the immediate term and the short term. “Remind yourself that you are safe and that your immediate problems are being taken care of,” Clayman says. “As for future problems? You’ve got time to work on them—and it’s a good exercise to limit how much we engage in the idea of the future and not obsess over it.” A better action plan? Dig a little deeper on exactly what’s causing you to lose sleep in order to make the fear more specific. Say, your worry is tied to a future expense—like childcare costs or a retirement account you’re questioning the stability of. Identifying this out loud gives you a jumping off point that you can try to plan around. That counts for a lot.
Why You Should Trust Us
PureWow's editors and writers have spent more than a decade shopping online, digging through sales and putting our home goods, beauty finds, wellness picks and more through the wringer—all to help you determine which are actually worth your hard-earned cash. From our PureWow100 series (where we rank items on a 100-point scale) to our painstakingly curated lists of fashion, beauty, cooking, home and family picks, you can trust that our recommendations have been thoroughly vetted for function, aesthetics and innovation. Whether you're looking for travel-size hair dryers you can take on-the-go or women’s walking shoes that won’t hurt your feet, we’ve got you covered.