By Mary Green
Well, it’s all been fun and games in the UK as we find ourselves in an increasingly sticky economic situation post-pandemic, with rising inflation meaning that everyone is feeling the pinch in their home budgets.
So, what to do?
Political and economic disruption are not new so focusing on securing your own personal microenvironment can help to reduce panic.
As someone who is currently going through a separation and heading towards divorce; I have needed to consider my emotional capacity, my mindset, and ability to soothe my financial fears in some depth recently. Here are my top 5 ways to calm financial panic and to help your financial wellbeing in times of uncertainty.
- Face the facts
If you don’t know where your money is going there is likely to be a constant low-key sense of worry and unease in the back of your mind. Trust me it’s better to face it.
Use a spreadsheet or an app that can monitor all your outgoings and incomings over a month. Just carry on as you normally do so you get an accurate picture.
Once you have the information, consider where you are. Do you have enough money to cover all your ongoing fixed expenses? These are bills that must be paid no matter what, gas & electric bills, council tax bills, water and rent or mortgage are all examples of these. What is the rest of your money going on?
- Magic money
Learn to accept that credit cards are not magical and the short-term pleasure is more than cancelled out by the long-term pain. Have a plan to get rid of unsecured debt such as credit cards, there are different methods to do this but focus on tackling the highest interest rates first for maximum impact. If you have trouble keeping motivated start with the smallest balance first for a quick win to spur you on. I raise extra money specifically to pay down my credit card. Any money coming from my side hustle (market research for financial firms) goes straight to paying them off, it’s not money that is part of my main budget, so I don’t miss it. Stop using credit as an emergency fund start using small regular savings plans or app’s which round up your purchases so that you have a rainy-day fund.
- Reduce regular outgoings and consider your spending
Review your subscriptions regularly, cancel any which you haven’t used for more than a month. Really consider your mindset if you are spending more than you can afford. Are you trying to look successful to other people, or are you comfort shopping to try and make yourself happy? I love clothes but I realised that buying my favourite designers when I am splitting my family budget in half was not sustainable. I get a lot of pleasure from dressing in a way which makes me feel confident, so what to do? For me I sell clothes on Vinted and buy more clothes with the money I make. It’s also very handy for kids’ stuff as the pesky creatures just keep growing!
- Find out what really matter to you
If you don’t have enough income coming in to sustain your lifestyle, then you either have to accept that your lifestyle needs to change or find ways of making more money. It has taken me awhile to understand and come to terms with the fact that it is not my four-bedroom house – that I can probably no longer afford – that really matters to me it is having a secure organised place, a sanctuary that feels safe, warm and smells good (I do love a good, scented candle) that is important to me. I have also examined my own skills and values and looked at ways to make extra income. These will vary from person to person but make sure they align with your overall purpose and vision.
- Ask for help
If you don’t have the skills to get yourself out of a situation, ask for help. That can be emotional, practical, or financial help. There is no shame in not knowing everything we all specialise; I get a plumber to do my plumbing I don’t try to YouTube it! Financial Planning is perceived as expensive but there are different kinds of help available. 1-2-1 help will cost around £1,000 with Rosewood Financial Planning and we can help you create a plan for life and help you make sure that it remains relevant when life changes. We are passionate about helping everyone, so we are currently working on a series of financial education courses to help those who are happy to work in a group get the basics under their belts.
Importantly, do not beat yourself up about where you are currently financially, or your money worries. A lot of our current financial woes are not at all of our making – we all deserve political representation that is working to support us, rather than create more problems for society. You have not done anything wrong here, but you do deserve better. Whilst our Government are incapable of caring for the majority, it’s never been more important that we look after each other where we can. So, what can you do to stop feeling so helpless in the middle of a crisis:
- Write to your local MP
- Attend and support local protests (Enough is Enough, March of the Mummies are just a few recent examples etc)
- Support local care or food banks where possible, either in terms of providing goods or time
Keep an eye and sign any petitions designed to support people who need help