Are Money Issues Causing Stress and Anxiety?

March 31, 2014

How high is your financial anxiety? Hopefully, it is low or at least manageable. Last month, my anxiety level went up briefly as financial stress crept into our family’s financial plan in the form of unexpected but thankfully minor surgery for our son, an emergency vet visit for our dog, and tuition bills for grad school (for me) and pre-school (not for me). Thank goodness we have an emergency fund and health savings account to offset some of the costs! Expected and unexpected expenses like these can wreak havoc on our financial plans if we don’t maintain some flexibility and adapt our plans as those “surely this won’t happen to me” events occur.

Life surprises can also lead to financial anxiety, which if not dealt with in a healthy and productive manner can impact more than our wealth. Financial stress and anxiety has direct and indirect effects on our overall health and well-being. A little stress in our lives isn’t necessarily a bad thing. In small doses, it can help keep us motivated and focused on identifying solutions that lead to positive change. In that sense, financial stress can be a good motivator to help us get our financial life plans on track.

But when that four-letter word (“LIFE”) happens and the obstacles on our paths to financial freedom begin to appear like permanent roadblocks, our stress and anxiety can begin to skyrocket. High levels of stress have been shown to negatively impact our physical and psychological well-being. It’s harder to focus on our work in times of financial stress and financial stress can also lead to an increase in arguments with a spouse or loved ones.

So how can you tell if your level of financial anxiety is too high?  In general, if you think your anxiety level is too high, it probably is. But there are some other tools you can use.  Here are some questions that were adapted from a Financial Anxiety Scale that was researched by Dr. Kristy Archuleta (one of my professors at Kansas State University…Go Cats!!!) and Anita Dale, one of my fellow doctoral candidates.

  • Do you feel anxious about your financial situation? (Yes/No)
  • Do you have difficulty sleeping because of your financial situation? (Yes/No)
  • Do you have difficulty concentrating on your work because of your financial situation? (Yes/No)
  • Have you been irritable because of your financial situation? (Yes/No)
  • Do you have difficulty controlling worrying about your financial situation? (Yes/No)
  • Do your muscles feel tense because of worries about your financial situation? (Yes/No)
  • Do you feel fatigued because you worry about your financial situation? (Yes/No)

If you answered yes to 2-3 of these questions, your financial anxiety level is at risk.  Positive responses to 4 or more questions provide a sign that your financial anxiety may be approaching the danger zone and you need to take immediate action and my need some professional guidance. (It is important to note that these questions are for informational purposes only and should not be viewed as a formal diagnostic assessment. More information about the actual development of the Financial Anxiety Scale can be found through the Association for Financial Counseling and Planning Education site.)

Sometimes a little awareness can go a long way in helping us identify the sources of financial stress. Once you’ve identified the cause of the stress, the next step is to address the problem.  Next week we will be taking a look at some specific ways to reduce financial stress and anxiety.