Friday, August 8, 2008

How to Stop Being Depressed About Money

Today I was reading an article by Laura Rowley entitled, "High Anxiety: Americans' Top Financial Fears Revealed." Basically the article outlined a lot of what we know already - people are worried about their finances. Across the nation people are concerned about the rising cost of living, the economic situations, the housing crisis, their savings and their debt.

I understand. At the beginning of this year I was not only depressed but scared witless. I didn't know how I was going to make my bills. I've always had fairly good credit, thought myself pretty good with money - yet suddenly it felt like "bankruptcy" and "foreclosure" were not that far off. I thought I had made good choices in my life, yet here I was - broke. It wasn't even that I wanted anything big. I just wanted to be able to stop worrying. I didn't need a ton of money - just enough to pay my bills and maybe buy a little something when I wanted it. Now I was fretting every time I went to the gas pump, let alone every time I went to the mailbox.

Money is such a hard thing to talk about. Give Me Back My Five Bucks just wrote a post about how personal finance is still such a big taboo in people's lives. It is true - one of the worst things about money is that people feel they can't talk about it. That is what adds to the depression - you feel alone, helpless, without even knowing where to start.

Here are Dawn's tips to pulling out of the money depression and learning to feel peaceful again:

1. Ask yourself these questions:
What am I scared of? What benefits am I getting from being depressed about money? What would it feel like not to be depressed about my finances? If I wasn't, what would I be doing? Do I want to change? Am I ready to try?

2. Face the Fear
Depression about money frequently comes from fear. I certainly did for me! It is the fear of the unknown - what is going to happen, how am I going to deal with it? The first thing you need to do is get a handle on what is really happening with your money. You've heard of getting over a fear by facing it? It is the same thing! Sit down and start figuring out how much money is coming in each month. That one is usually pretty easy - look to your pay stubs. The next one is harder - figure out where your money is going. It helped me to gather monthly statements from every one of my bills - from the car payment to the utilities to my Netflix subscription.

3. Take Control

Now that you got the facts and figures, you can start making a budget. There are lots of resources online for how to do it. Take a look at BeingFrugal's article on it, for example.

Then once you've made a budget, start using it. Also start looking for ways you can cut costs, save money and earn more. There are countless ways to start changing your situation, but the important thing is, once you start moving towards a goal, you find you feel a lot better. It doesn't mean you still won't get in a funk - I have periods of "money blues" but knowing I have a goal and working towards it has kept me out of depression - and foreclosure.

4. Get informed.
There are hundreds of great blogs and articles out there on nearly everything under the sun when it comes to finance. I've put links to some articles and books I have found especially helpful on the bottom of this post, but look around. PFBuzz for example, has some great articles - and you can rate them as to how well they helped you.

5. Regularly review your goals.
Sometimes it can be easy to get off track. I know that there are times when I am very motivated and focused and putting a lot of energy into it - and then something happens: an illness or even a vacation, and it all goes to the wayside. It can be tough to get back on track. That is why it a good idea to make financial goals, review them frequently, and keep track of how you are doing. If you keep a notebook (or like me a blog) that outlines your success - that can be a real moral booster when times are hard.

6. If all else fails seek a professional.
Depression can be a very serious problem. Seek professional help if you need to - whether that is a counselor, therapist, minister, or financial adviser. Yes, these may cost money, but many have programs for people with financial difficulties - and your health is one of your best assets to get your life back on track.

More Suggested Reading on the Web: - How to Make a Budget That Works
Financial Ramblings - 19 FREE Personal Budgeting Spreadsheets
Consumerism Commentary - The Correct Way to Pay Off Personal Debt: The Debt Avalanche
I've Paid for This Twice Already - Using Language as Motivation
Fighting Foreclosure - 8 Tips to Help You Fight Foreclosure
Sue Meyers - Getting Rid of Depressed Feelings
Laura Rowley - Four Habits of Financially Peaceful People

Suggested Reading - Books:

Women & Money: Owning the Power to Control Your Destiny

Pay It Down! : From Debt to Wealth on $10 a Day

How to Invest $50-$5,000 9e: The Small Investor's Step-By-Step Plan for Low-Risk, High-Value Investing

Photo by Dailyinvention


MoneyEnergy said...

So often we PF bloggers focus on the technical, pragmatic How-To's of finance and investing. I like your post because it deals with the psychological aspects of facing your finances.

Dawn said...

Thank you so much!