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Reduce Money Stress, Inside and Out

There are two ways to stop stressing over money, and you need to do both: attack the financial problem itself and practice a proven stress reliever.

by Jean Chatzky

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Job pressure. Lack of money. A chronic illness. Divorce or death of a spouse. Poor nutrition (too much sugar, too much caffeine). These are the top five stressors in the United States, according to the American Institute of Stress. Take a look at them, and what do you see? For the top four stressors, the common factor is money.

Pressure at work? You’re afraid you’re going to lose your paycheck. Lack of money? Enough said. A chronic illness? Unaffordable medical bills are the leading cause of bankruptcy, year in and year out. Divorce or death of a spouse? All of a sudden, you have to support yourself and manage your finances on your own. (You could even make a case that poor nutrition could be remedied with enough money for higher-quality foods and perhaps a visit or two to a nutritionist.)

Why are finances such a trigger for stress? “It comes down to the fact that the brain perceives any sort of deficit—of not having enough—as being a primal need to adapt,” says Dr. Heidi Hanna, author of Stressaholic. Stress, she explains, is your body telling you that it wants a change, and that you need to adapt. Unfortunately, when it comes to financial stress, “we often perceive that there are no resources to be able to get out of that, so we’re not able to adapt as easily.”

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Before you can tame your demons, you have to recognize that financial stress comes at you from two directions. There are internal and external factors, and to ease the stress you have to deal with both of them. External stress is caused by the situation itself—say, not having enough money to pay the credit card bill. On the flip side, “internal stress is the kind we create for ourselves with anxiety and self-judgment,” says Dr. Robert Schachter, a cognitive therapist and assistant professor at the Mount Sinai School of Medicine. What you need is a tactical solution for dealing with the actual situation (external stress) plus proven methods to calm yourself down, he explains.

“You have to attack the financial problem, but you also need strategies that target the stress itself.”

Unfortunately, it can be difficult to distinguish between internal and external stress. Take job pressure. In 2009, the unemployment rate in the U.S. hit 10 percent, but by 2015, it was only half that, according to the Bureau of Labor Statistics. Yet, according to the University of Michigan’s Consumer Confidence Survey, people were just as worried about losing their jobs in 2015 as in 2009. For people in industries on the decline, the threat to their jobs may have been real, but for others the stressor was clearly internal. Complicating matters: Financial stress is an equal-opportunity demon. Even people with plenty of resources aren’t immune. Why? Because the fear of losing—or even just maintaining—your assets (however large or small) is shared by almost everyone.

How best to deal? With a one-two punch, says Dr. Michael Roizen, chief wellness officer of the Cleveland Clinic (and my co-author for the upcoming book Ageproof: Live To 100 Without Running Out of Money or Breaking a Hip). You have to attack the financial problem, but you also need strategies that target the stress itself. Although the best tactics to work various financial problems can differ (pressure on the job is a far cry from losing a spouse or getting divorced), the techniques to deal with stress itself are universal. The goal, Roizen explains, is to find a method that works for you, practice it daily and then use it for everything.

So consider the following a Chinese menu of solutions. Apply the specific suggestions to tackle the financial difficulty you are facing. If you can solve the problem, the stress should abate, and you’ll be better situated the next time one rears its head. Then apply one of our solutions for the stress itself—choose a technique that sounds appealing, and if it doesn’t work, abandon it and try another. Whether it’s yoga or mindfulness, a dependable way to de-stress is something we all need in our toolkits.

Step one is looking outward, toward the external stress, and solve the financial problem you face. Here, our experts’ top strategies for tackling the four top money-related stressors.

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If You’re Stressed by Job Pressure

Your boss stops by your desk and says he’d like to talk tomorrow afternoon at two. How do you react? If your mind starts racing, certain that you’re going to be fired even though you have no information to support that, you’re dealing with internal stress. Check out the techniques recommended below.

But if you’ve been told layoffs are in the offing or you got a poor performance review, the stress is being brought on by the situation itself. Try the following:

1. Review what you know to be true about your performance. If you have copies of your last several performance reviews, read them. Then put pen to paper (or fingers to the keyboard) and note how you’ve reacted to any criticism you received. If you’ve already taken steps to fix any areas in which you were lacking, use that information to reassure yourself and calm yourself down. If you haven’t taken those steps, it’s time to start. Chart your progress, detailing the bottom-line implications (my sales are up 5 percent this quarter) and any feedback you receive from colleagues and supervisors.

2. Check out your company. If you’re fearful that the fortunes of your firm or your industry are heading in the wrong direction, read analyst reports, news stories or anything you can get your hands on to assess this. If that information isn’t available, look for signs of the company’s prosperity (the office was recently spruced up, there are free snacks by the coffee machine), or ask your boss how business is going.

3. Expand your employment options. It’s always best to look for a new job while you still have the old one. So, update your resume and your LinkedIn profile, and start scheduling lunches or coffee with contacts in your field and applying for open positions.

4. Get your finances in order. Finally, if your emergency savings won’t tide you through a three- to six-month period of unemployment, make bolstering your cushion the top task on your financial to-do list. You may have to reduce other current expenses in order to make that happen. It’s worth the short-term sacrifice.

If You’re Stressed by Lack of Money

If you never believe you’ll have enough money, whether for retirement or to pay next month’s bills (even though you have a track record of being a consistent saver and paying every bill on time), your psychology is one of scarcity. “In some cases, people think they don’t have enough money, and they do,” says Schachter. On the other hand, if you’re constantly short-changing your savings to pay a bill or paying off one credit card with another, the stress is situational and you need to take steps to deal with that.

1. Become a believer. If you think you never have enough money, even though you know you do, it’s time to embrace the numbers. Start using an app like Mint to track the balances in all of your saving, spending and investment accounts to gain a comprehensive picture of your financial life. You’ll be able to see that your savings are rising (not falling), that your credit score is top-notch, that your investments are holding up. Then, use that information to reassure yourself—even if you have to look at the numbers every day—that the sky isn’t falling. Not even a little bit.

2. Turn off the financial news. “There’s so much noise coming in from the outside about financial pressures and insecurity in the market, it’s a constant reminder that finances are uncertain. And it’s that uncertainty that really puts the stress on people,” says Hanna. Instead, check your portfolio once a quarter.

3. Reduce high-interest debt. Credit card debt is particularly stressful for two reasons—it prevents you from saving (think about how much you could stash away if you weren’t paying interest charges), and it destroys relationships. (A study by the National Marriage Project documented that couples who save together stay together, and those who accumulate debt are much more likely to break up.) Try an app like ReadyForZero, which will give you a debt payoff plan.

4. Work the other side of the equation. There are just two ways to put extra money in your pocket: Spend less or earn more. Consider picking up a side gig as a way to supplement your income.

If You’re Stressed by a Chronic Illness

Some 45 percent of Americans have at least one chronic condition, and by 2025 that number will climb to more than 50 percent, according to the RAND Corporation. The costs, which account for 75 percent of our country’s annual expenditures on health care, according to the Centers for Disease Control and Prevention, can be considerable. Here, external stress comes about if you truly are unable to manage your medical expenses—or if they prevent you from achieving your goals. (According to the National Bureau of Economic Research, the healthiest people accumulate 50 percent more assets for retirement than those in poor health.) Internal stress is caused by worry about what havoc your condition might wreak on your finances sometime in the future. Try these solutions:

1. Trim your medical bills. You can shave about one-third off the cost of medical care by paying for it with pretax dollars that you contribute to either a flexible spending account or health savings account. These funds can be used for almost all medical expenses save over-the-counter drugs, and even then you can get an exception with a doctor’s prescription. Note there is a difference between the two accounts. Your employer needs to offer an FSA for you to get one, and any unused FSA dollars are lost at the end of the year (or FSA cycle, which at some companies ends in March). To qualify for an HSA, you need to have a high-deductible health plan. The money you contribute is yours to keep and can grow into a supplemental retirement account if not tapped for healthcare.

2. Comparison shop. It’s important to shop around for the lowest prices on prescriptions. and can show you the range of prices being charged in your area for particular drugs and help you find the best ones. Do the same for medical procedures. The Healthcare Bluebook can give you a barometer of what procedures should cost. And if you’ve got medical bills you believe are higher than they should be, is a company of professional bill negotiators. They analyze your medical bills to determine the savings and negotiate on your behalf for 35 percent of what they save you.

3. Do what you can for your condition. “You want to be sure that you’re doing what’s optimal for your condition and, if possible, reversing it,” says Roizen, who notes that in the case of Type 2 diabetes, this means managing your blood sugar and blood pressure and increasing physical activity to break down your resistance to insulin. “That means making time in your schedule so that you are a priority.”

4. Get a second opinion. The joy of doing so is that you’ll have more confidence in your treatment, Roizen says. And more confidence equals less stress. Most insurance companies will pay for it.

5. Plan for your future. Sit down with a financial advisor and strategize to deal with the fact that you will face costs associated with your chronic condition in the future. According to Fidelity Investments, at 65 a couple will need $260,000 in retirement savings just to pay for unreimbursed medical care. Depending on the state of your health, you may need even more.

If You’re Stressed by Divorce or Death of a Spouse

It can take years to learn to manage a major stress, like the death of a spouse or a divorce. You can—and should—try to move forward with financially focused moves and stress management, but it’s important to acknowledge that nothing you do will speed up the cycle a lot. “You have to say, ‘It will take me two years to get over this,’” Roizen says. Then, layer on these solutions.

1. Find another financial partner. When my father died, I helped my mother find a financial advisor because, although she had been the primary manager of their portfolio, she had lost her sounding board. She needed another person with whom to talk through major financial decisions. If you’re accustomed to discussing finances with your spouse or partner, you should consider doing the same. You can find an advisor at, or All three have zip code locators.

2. Embrace other relationships. Not romantic ones, necessarily. But in addition to financial people, you need others in your life to reduce stress, says Roizen. “For women, especially, relationships are very important.”

3. Revise your plan. Whether or not you opt for an advisor, there is a certain stress in having a long financial to-do list. Set up a schedule for yourself where you’ll accomplish one item a day (change the beneficiaries on your IRA, deal with the joint credit card) until it’s done. If that’s too aggressive, do one a week.

4. Get things done. Besides tackling your financial to-do list, make a list of other activity-oriented things you want to accomplish, and check them off. Clean the garage. Get a puppy to walk. Take up Zumba. “Doing something physical can help you get to the next step,” Roizen says.

Now Look Inward: Take Aim at Your Stress

OK, you’ve assembled tactics for dealing with the actual situation, whether it’s a failing project at work or unpaid medical bills. But however you address the problem, you can ease its effect in another way: by treating how the situation makes you feel. When you’re faced with stress, parts of the body’s systems that are needed for survival become activated. Blood pressure rises. Adrenaline surges. Your pancreas releases sugar to provide more energy. Under normal stress conditions (think about riding a very scary roller coaster), your body goes back to its normal functioning once the immediate threat subsides (and you’re off that crazy contraption). But many financial stresses are chronic, Schachter explains. “Your system remains activated, and it can have [long-term] physical effects” including heart problems, headaches, stomachaches and the like. “If you can learn to relax your body, this can reverse the effect of stress being chronic.”

Here’s the key word in the previous sentence: learn. Whether you choose to try deep breathing, meditation or some other method, you need to practice it daily, Schachter says, so that when stress hits, your response is almost automatic. Your body understands what you’re doing when you start slowly breathing in through your nose (more on this in a moment), and it calms. Adrenaline levels drop. So does your heart rate. Now, this isn’t going to solve your underlying financial issue. But it will make you feel better. And when you feel better, you are better equipped to tackle the issue you face.

If yoga or meditation sounds appealing, find a nearby class and start going regularly. If you prefer a quicker DIY fix, try these four techniques:

1. Easy deep breathing. Put one hand on your chest and the other on your stomach. Slowly breathe in through your nose to a count of six, making sure your diaphragm inflates. Slowly breathe out. Do this continually for five minutes. Repeat nightly.

2. Progressive relaxation. For this exercise, you will tense and then release large muscle groups one after another. Start at your toes and work upward. Clench your feet, hold for 10 seconds, then release. Move to your calves, your knees, your glutes, your abs, all the way up to your jaw. Repeat nightly.

3. Simple meditation. Find a quiet place (the bathroom works, Roizen says, if you’re out of other options) then focus on your breathing or on a phrase that is calming to you. He suggests: “I can see Hawaii.” As you repeat the phrase in your mind, picture yourself on a beach in Hawaii. This kind of visualization can help clear your mind.

4. Exercise. Recent studies have found that people who experience financial stress have PTSD-like symptoms, says Hanna. Physical exercise can provide a good antidote. “It decreases stress hormones and increases positive endorphins in the brain and body. There are things in your circumstances that you can't control. Taking care of yourself is something that you can. Then, not only are you better able to deal with the stress, you're recharging your energy for the next opportunity when it comes.”

With Hayden Field