If you don’t have enough money to meet your basic needs, you’re probably experiencing financial strain and stress, and you’re not alone.
Money, or a lack of money, is the top stressor for 44% of Canadians, according to the most recent Financial Stress Index from FP Canada. From the high cost of groceries and daily living to elevated housing, gas, and interest costs, there are several factors contributing to financial strain on Canadians.
Effects of Financial Strain
Financial strain can occur at any point throughout your life, from childhood through retirement. You can experience financial strain when you make a large purchase like buying a house, if you lose your job, or if you have tons of high-interest debt.
The effects of financial strain reach far beyond your wallet. Money problems can seep into every part of your life, impacting your relationships, sleep, work performance, and mental and physical health. Here are some examples of how financial strain can affect your overall well-being.
Increased depression
Many studies have found a positive relationship between financial strain and depression. As you might expect, if you’re dealing with low incomes and high levels of debt, you’re at a higher risk for depressive symptoms.
Poor quality sleep
When you’re dealing with financial strain, you may find that your sleep suffers. Studies show that those experiencing financial hardship have a higher risk of poor sleep quality and insomnia. Insufficient and poor quality sleep are associated with higher accident rates, premature death, and a variety of health conditions.
Reduced productivity
Financial stress can also reduce productivity. When you’re worried about how to pay your mortgage or feed your family, it makes it harder to focus at work. If you can’t perform, this can potentially lead to getting fired, which will only increase your financial concerns. Studies have found that workers become more productive, make fewer errors, and are more attentive, when they’re paid a wage that can sustain their lifestyle.
Poor physical health
Those exposed to financial strain are at a greater risk of illness including cancer, diabetes, asthma, heart failure, and death. Financial strain can also impose more barriers to good health, including an inability to eat regular, healthy meals, or the inability to pay for medication.
Relationship issues
Seventy-seven percent of Canadians couples are stressed about money, and 62% argue about it, according to a recent BMO poll. Financial disagreements are also one of the top causes of marital problems and divorce.
Increasing loneliness
Research has also found that financial strain can increase a sense of loneliness, especially among older adults. Financial issues can cause feelings of shame and embarrassment, which can lead people to pull back from social situations. Low income can also reduce the amount of social activities that you can afford to participate in.
How to Reduce Financial Stress
There’s a lot of evidence to suggest that financial insecurity can negatively affect your well-being. So, what can you do to prevent this stress? Luckily, there are things you can do to reduce financial strain, including:
Understand the problem
When you’re dealing with debt and other financial issues, you try to pretend it’s not happening. But ignoring your money troubles won’t make them go away. If you want to improve your situation and reduce your stress, you need to understand where you are and how you got into the situation. This means reviewing bank statements, credit card bills, and all debts to get a clear picture of your finances.
Create a budget
A budget is a tool you use to manage your money. It helps you track your income and your expenses. If your expenses are greater than your income, you’ll have to look for ways to cut costs. If you’d like help creating a budget, the Government of Canada offers a budget planner tool. There are also a variety of budgeting apps you can use to track your income and spending.
Reduce your expenses
To reduce financial strain and balance your budget, look for ways to cut your discretionary spending. For instance, cancel subscription services, reduce how often you eat out, and take public transit or carpool to save on gas. To significantly decrease your costs, you might even consider downsizing to a smaller home or selling a vehicle.
Make more money
In addition to cutting expenses, you can look for opportunities to bring in additional income. If possible, take on extra shifts at work or consider a side hustle. Then use the additional income to pay off debt.
Talk to people you trust
If your financial issues are causing you to isolate and avoid social situations, make an effort to talk to a trusted family member or friend. Having an open dialogue about money can make you feel less alone and can offer some immediate relief. If you’ve been trying to protect your spouse or partner from money issues, it’s important you open up so you can try and solve your issues together to prevent strain on your relationship.
Speak to a professional
Most Canadians were never taught how to manage money. So if you’re experiencing financial strain, don’t let shame and embarrassment stop you from getting help. A Licensed Insolvency Trustee (LIT) is a debt expert who can assess your finances and help you get your finances back on track. LITs can also offer the widest range of debt help solutions, from credit counselling to a Consumer Proposal or Bankruptcy.
Reduce Financial Stress – Speak to a Licensed Insolvency Trustee
If you’re tired of dealing with the stress and pressure caused by financial strain, consider reaching out to a Licensed Insolvency Trustee at Allan Marshall and Associates. Don’t navigate your debt alone, we can help. For a free, no-obligation consultation, give us a call at 1-888-371-8900 or complete our online contact form.
