Money anxiety is something most of us live with, even if it is a business loan for self-employed income or just the general feeling that one doesn’t have enough. If you’ve ever known the sinking feeling in your stomach as you looked at your account balance, you are not alone. The good news? There are practical steps that can be taken to reduce stress and reclaim a sense of control over finances.
Where Your Money Goes?
Knowing where your money is going is one of the best ways to manage anxiety around money. Easy to be worked up with when you don’t know your financial situation. Tracking your expenses gives you control over financial situations that could otherwise seem overwhelming to you.
Let’s assume that you spend Rs 50,000 a month. Here is the breakup:
| Category | Monthly Amount(Rs) |
| Rent/ Mortgage | Rs 20,000 |
| Utilities & Bills | Rs 5,000 |
| Groceries | Rs 8,000 |
| Transportation | Rs 3,000 |
| Entertainment | Rs 4,000 |
| Miscellaneous | Rs 10,000 |
Now, by knowing exactly where your money goes, you can easily identify areas to save. For instance, one might realise that one spends Rs 4,000 on entertainment when Rs 2,000 would be enough.
Set Realistic Financial Goals
Feeling overwhelmed by money is often due to a lack of clear goals. In this case, setting achievable goals will help one stay focused and motivated enough to reduce stress.
Start Small:
If you are in debt, have a target like “Repay ₹ 5,000 amount against the debt within 3 months.” It is much easier to focus on rather than thinking of the huge total amount.
| Goal | Amount | Timeframe |
| Pay off Credit Debit | Rs 5,000 | 3 Months |
| Build Emergency Fund | Rs 10,000 | 6 Months |
| Save for a Vacation | Rs 15,000 | 12 Months |
How to Get It Done
- Designate a percentage of your income for each goal.
- Tackle one goal at a time rather than trying to juggle everything in the air.
Create an Emergency Fund
An emergency fund is money kept aside for unexpected spending, such as a car repair or a medical bill. Save enough to be rewarded with some extra peace of mind when another emergency hits. Goal: Save at least Rs 10,000 for your first emergency fund.
How much should you save?
Let’s break it down with a weekly contribution:
| Weekly Savings (Rs) | 3 Months Savings (Rs) | 6 Months Savings (Rs) | 12 Months Savings (Rs) |
| Rs 500 | Rs 6,000 | Rs 12,000 | Rs 24,000 |
| Rs 1000 | Rs 12,000 | Rs 24,000 | Rs 48,000 |
Even saving Rs 500 a week adds up to be ₹ 6,000 by the end of the month. It can prevent you from having to borrow or use credit with all the stress that comes with it.
Start Automatic Savings
The easiest way to stay true to your savings goals is to automate it. It means you save without having to think about it. You can set up an automatic transfer of, say, Rs 1,000 every month to a savings account.
| Monthly Automated Savings (Rs) | 6 Months (Rs) | 12 Months (Rs) |
| Rs 1,000 | Rs 6,000 | Rs 12,000 |
| Rs 2,000 | Rs 12,000 | Rs 24,000 |
Automation of savings eliminates the emotional complexity of budgeting. You would know that money is being saved for emergencies, retirement, or any other goals of yours.
Pay Off Just One Debt at a Time
Most of your money anxiety can stem from debt. If you are overwhelmed with many debts, try paying them off one at a time instead of trying to fight them all.
Debt Snowball Method Example:
| Debt Type | Balance | Minimum Payment | Extra Payment | Total Payment | Payoff Time (Months) |
| Credit Card | Rs 15,000 | Rs 1,500 | Rs 1,500 | Rs 3,000 | 5 |
| Personal Loan | Rs 25,000 | Rs 2,000 | Rs 0 | Rs 2,000 | 13 |
Even reducing the amount from one debt makes you see milestones that help you still feel better each time.
Mind Your Mental Health
Lastly, take care of your mental well-being. Financial stress can be very damaging to your mental health, and finding ways to minimise that is crucial. Find time to relax each day—even if it’s just meditation, exercise, or hanging out with the family.
Take Control and Breathe
Ask yourself this: What is the smallest thing I can do today that can reduce my money anxiety? The more you take control of the finances, the more peaceful the rest of your mind will be.
Frequently Asked Question
Q. What’s the best way to start budgeting?
Start by tracking your expenses for a month and categorize them. From there, you can set limits for each category.
Q. How much should I aim to save in an emergency fund?
Aim for at least Rs 10,000 to start. Adjust this goal based on your monthly expenses.
Q. Can I reduce debt while saving?
Yes, focus on paying off one debt at a time and save small amounts regularly. Both can be balanced.
Q. How often should I review my financial goals?
Every three to six months, see if you need to adjust based on changes in your income or expenses.