Half of Americans say they are stressed by finances [1]. And more than three fourths of Americans have experienced health impacts due to stress [2]. It’s no secret that one of the leading causes of anxiety is personal finance. Money may not be the root of all evil, but it does cause its fair share of tension. May is Mental Health Awareness month, and we’re exploring how mental health and financial wellness are intertwined—and sharing some steps you can take to alleviate financial stressors.

It can be intimidating at times to think about or attempt to manage our finances. Sometimes it seems like the bills keep piling up with no end in sight. At other times, our bank account just seems to get smaller and smaller, and we aren’t sure of a way forward. The stats are telling:

73% of Americans in debt are stressed about money, and one in 20 are fearful they will be unable to pay their debt off, ever! [1]

76% of Americans experienced health impacts due to stress [2]

27% report being so stressed they cannot function most days [2]

Some fairly common “bad money habits” often lead to more stress, anxiety, and fear around money, such as:

Not opening bills and telling yourself you’ll deal with it later

Ignoring one’s bank account in order to avoid the anxiety it causes

Avoiding student loan payments and letting debt get out of hand

Racking up credit card debt (i.e., impulse buying to satisfy a void)

Avoiding investing for the future because of fear of market volatility

If you thought these were just your bad habits, think again. Almost everyone has fallen into one of these traps at some point. Almost all of us are dealing with some form of financial anxiety. 

With that said, let’s get to the good news.

The fact is that, with some intentionality, mindfulness, and education, you might find yourself more aware, in control, and less stressed about that next bill coming due.

One practical step to managing your finances with greater intentionality is to create a budget. If you create a budget and stick to it, you are more likely to sleep peacefully at night. How many of us walk away from a purchase we can’t afford and then end up patting ourselves on the back later because of how good it feels? If you don’t know where to start, consider utilizing free budgeting resources like mint.com or creating a spreadsheet and tracking all or your income and expenses. If you want to pay for something more technically robust, consider a platform like You Need A Budget, Quickbooks, or Quicken. Any one of these can help you increase awareness and guide you in future decision-making.

Next is mindfulness. Consider starting a gratitude practice and making decisions from a place of contentment. Mindfulness is a way to keep one’s focus on the present moment, and often includes practices like meditation and yoga. But you don’t have to become a yogi to be mindful. You only need to keep your attention on the present. By being aware of our thoughts and emotions, we can avoid being overcome by them and can even manage them more effectively. One important thing to be aware of is what we do have in life, not what we’re missing. It is easy to pile up negative thoughts particularly as relates to personal finances. But we shouldn’t forget that very often our basic needs are met, and we have a number of things to be grateful for. Take some time to consider what your values are and identify whether you already have what you’re seeking in life. You might find yourself in a completely different state of mental health, which could aid in your financial decision-making.

Lastly is education. Many of us did not learn about finances growing up (at least in the formal education system). So, we’re left to rely on ourselves, family and friends to put the pieces together. If you feel under informed when making financial decisions, you’re certainly not alone. And knowing that may be enough to ease some of the anxiety. To help, consider free resources like Nerdwallet, Investopedia, or Fidelity. Each has great tips on saving, investing, and how to budget. You could also check out my other blogs discussing financial wellness:

Behavioral Biases and Finance: How Our Attitude Toward Finances Can Impact Our Overall Financial Wellbeing

Financial Literacy Month: How to Control Your Money Instead of it Controlling You

Prep for a Recession: Get Back to Money Management Basics in Five Steps

Additionally, consider working with a professional like a CFP® to help guide your decision making. CFPs are fiduciaries who provide holistic advice on the full scope of your finances and provide cash flow analysis to help you identify areas of opportunity. You can go to letsmakeaplan.org to find a CFP in your local area. Understand that not all advisors have investment minimums, and you can work with an advisor of your preference.

As you can see, mental health and financial wellness are intimately related. Americans in general are stressed about their finances and this is having an adverse impact on overall wellness. But with practical steps like intentionality, mindfulness, and education, there is a path forward that can help us decrease stress and increase our mental well-being.

[1] Bankrate, More than half of Americans say money negatively impacts their mental health, up sharply from a year ago, May 2023: https://www.bankrate.com/personal-finance/financial-wellness-survey/ 

[2] Benefits Pro, Inflation pain: 44% of Americans are living paycheck to paycheck, April 2023: https://www.benefitspro.com/2023/04/19/inflation-pain-44-of-americans-are-living-paycheck-to-paycheck/

[3] American Psychology Association, Stress in America 2022

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May is Mental Health Awareness month, and we’re exploring how mental health and financial wellness are intertwined—and sharing some steps you can take to alleviate financial stressors.

How Financial Stress Can Impact Mental Health—and Steps to Achieve Peace of Mind

Last week, I hosted ABD’s very first Financial Wellness webinar. As a member of ABD’s Financial Wellness Team, I spend my time working with companies to create and deliver meaningful financial wellness programs. It was a valuable experience sharing my insights regarding successful financial wellness initiatives with a wide array of employers. We covered a variety of topics, ranging from the impact of financial stress on a company to the creative ways of delivering support to employees. Here are some key takeaways from our session:

Research on employee wellness has found that financial stress can lead to reduced retention, increased absenteeism, and decreased productivity. More than 30% of polled employees revealed that they are often distracted by their finances while at work, reducing their productive time during the workday. However, employees are ready to receive support and take steps to improve their financial lives. At ABD, we have seen that financial wellness education drives employee action. 88% of our program participants surveyed were likely to take follow-up steps based on their learning. We also noticed employees were able to increase their retirement savings rates following our educational sessions. Financial wellness programs are effective and in-demand, which makes them a valuable tool in meeting the needs of employees.

There are many kinds of financial wellness programs and initiatives – Find the one that works for your employees and get going! Your employees’ needs will likely vary across industries, age groups, and backgrounds, so an effective financial wellness program is one that can tackle a variety of financial struggles. Some employees may benefit from one-on-one coaching by a finance expert, while others may need information on a specific topic like getting the most from their company benefits. Selecting from of the many different financial wellness tools, education, communications, and guidance will allow you to create a program that works for your employees.

Financial wellness programs have the potential to motivate and empower your employees. At ABD, we know that creating a program that works for your employees can be complicated. ABD can be your financial wellness partner to help you determine the specific needs of your employees and create a program targeted to address those needs.

For more information on ABD’s Financial Wellness services, check out our Next Steps sheet to get you started in the process.

You can also reach out to our team at financialwellness@theabdteam.com to begin a conversation with our experienced team today.

Last week, I hosted ABD’s very first Financial Wellness webinar. As a member of ABD’s Financial Wellness Team, I spend my time working with companies to create and deliver meaningful financial wellness programs. It was a valuable experience sharing my insights regarding successful financial wellness initiatives with a wide array of employers. We covered a […]

Bringing Financial Wellness to Your Workplace

As the year comes to a close, we often look for opportunities to change and grow by creating personal New Year’s resolutions. This year, it’s time to get your company motivated to do some goal setting too. One way your company can enhance their benefits offering and improve the quality of life for its employees is by incorporating financial wellness into its company values. Employees need more resources to help them manage their personal finances, and when employers step in to facilitate the learning process, they improve workplace productivity and stay competitive among other employers.

At Newfront, we see the goal of financial wellness programs as giving employees the insight and tools to empower their own financial decision-making. Financial wellness may seem like an imprecise term to ask of employers because there are many definitions floating around today, but many companies have already caught on to the financial wellness movement. In fact, according to a recent Prudential survey, 83% of employers are offering some kind financial wellness program already!

A survey by Price Waterhouse Cooper recently found that over half of today’s employees are stressed about their finances. As many of us know, it’s challenging to leave our worries behind when we step into the office every day. Financial anxiety affects the work that employees can deliver, and ultimately impacts a company’s bottom line. Financial Finesse ROI Special Report 2016 found that employees who struggled with their finances were more likely to show absenteeism, receive wage garnishment or take a hardship withdrawal from their 401k savings. There is a dollar cost to employers who overlook the financial struggles of their workforce, and now is the moment to make a change.

As I mentioned earlier, the objective of financial wellness programs is not to solve an individual’s financial problems for them, but instead to increase employee awareness and empower them to act. Companies in the United States are getting creative with their diverse workforce and budgets to give employees opportunities to develop their personal finance skills. Some companies focus on one key personal finance issue, like retirement readiness or improving credit scores to use as their vehicle for financial wellness. Other companies look towards adding new benefits to engage their employees.

Your company many not be ready to invest heavily into an integrated online platform or on-site financial counselors, but there are plenty of ways to start serving your employees’ financial wellness needs.

We’ve come up with a few quick, easy, and cost-effective ways to get your employees on the right track:

Help get your employees engage with current benefitsInvite providers to speak at lunch-and-learns or “office hours,” allowing employees to ask questions and learn about offerings they may not know exist.

Facilitate monthly emails with basic personal finance tips to encourage personal finance awareness. You can even start by collaborating with your People Operations team to look at current employee statistics to get a better sense of what your workforce needs or what interests them within the world of personal finance.

Connect employees with free online tools. The web is rich with retirement calculators, financial wellness video and personal finance phone apps to help employees navigate through any personal finance struggle they may be experiencing.

New Year’s resolutions shouldn’t just be for the individual. Companies can also resolve to improve by offering new benefits, education, or even just promoting free products that help with personal finance concerns. Coming to work free of money anxiety and stress is a goal that we can all set for ourselves, either on an individual or company-wide level. If you can get your company to bring a strong financial wellness culture to ring in 2019, you’ll help make this coming year more productive in the workplace and financially fruitful at home.

As the year comes to a close, we often look for opportunities to change and grow by creating personal New Year’s resolutions. This year, it’s time to get your company motivated to do some goal setting too. 

Your Company's Next New Year's Resolution: Financial Wellness

Thanksgiving is right around the corner, and so is the stressful holiday season. Black Friday, Cyber Monday, Small Business Saturday, how does anyone make to January with any money left over in their checking account? The holidays can trigger a lot of anxiety around money, when all we really want is peace and joy. Believe it or not, the solution to finding financial bliss during the holiday season is simple, and it comes from the latest buzzword in personal finance.

The concept of Financial Wellness or Wellbeing has become a buzzword in the business world, and there are many ways to define financial wellness. Simply put, having financial wellness is feeling confident and knowledgeable about your personal finances. Here at ABD, we see cultivating a state of financial wellness as a 3-step process. If you can focus on building awareness, developing understanding and taking action with your finances this holiday season, you’ll be a lot closer to a state of personal finance tranquility as 2018 comes to a close.

The first step towards feeling stress-free with your holiday is to become more conscious about your current financial situation. Do a quick check of your cash flow to make sure you know how much you can comfortably spend on loved ones, traveling, and all those fun holiday parties. You can calculate your discretionary funds by looking at your paystubs for the month and subtracting your necessary expenses like rent, insurance and groceries. Or you can download a budgeting app that calculates it all for you like Personal Capital or Mint. If you can quantify what kind of money you have left over at the end of each month, it will be easier to decide later how much you can reasonably spend this holiday season. With a basic awareness of your cash flow in mind, you can now feel at ease when saying “yes!” to those fancier presents or extra cocktails during the holidays, knowing you won’t be spending beyond your means.

Once you have a better sense of how much money you can spend over the holidays, make sure you know what kind of impact over or under spending will have on your financial situation over all. It’s easy to whip out your credit card and tell yourself, “the more you buy, the more you save!” as you take advantage of doorbuster deals and other can’t-miss sales. Nevertheless, you should be wary of how risky amounting credit card debt can be. With the average credit card APR at 17.14 percent, any amount in your credit card balance that rolls into the next month could increase dramatically in a short time period. Most experts recommend you only spend on your credit card on what you can afford to pay off in cash. Sticking to a spending limit this holiday season can help you avoid risky credit card expense that might make this winter feel more stressful than calm.

Additionally, if you already have money left over after your holiday spending, you can find positive ways to reward yourself by making those extra dollars work for you. Aside from building an emergency fund in a traditional bank account, you can also focus on contributing towards your retirement or even paying off any other debt you may have. It’s important to know that your dollars do you the most good if they’re paying off your balance in full each month, or helping you save for the future.

After you’ve taken a good look at what’s reasonable to budget out for your holiday purchases with the benefits of spending wisely in mind, go ahead and take action! If you want to set aside more cash for the next few months, see if you can hack your spending habits in different parts of your life. Make coffee at home and avoid buying holiday lattes. Eat out just on the weekend for the next couple months and prep homemade meals to take to the office. Check your budgeting app for advice on where you can cut back spending- both Mint and Personal Capital have built-in budgeting tools. Choosing your next step will come more naturally when you have a clear sense of your cash flow, and a reasonable idea of how much you want to spend during the next few months.

Everyone deserves to go in to the holiday season focused on friends, family and relaxation- instead of bills and dollar signs. Use your new awareness of your cash flow to make the best decisions for you. Now you can not only shower your loved ones with gifts this year- but also carry along the spirit of financial wellness!

Emily Juarez
Financial Wellness Specialist
emily.juarez@theabdteam.com

Thanksgiving is right around the corner, and so is the stressful holiday season. Black Friday, Cyber Monday, Small Business Saturday, how does anyone make to January with any money left over in their checking account? The holidays can trigger a lot of anxiety around money, when all we really want is peace and joy. Believe […]

How Financial Wellness Can Help You Through Stressful Holiday Spending

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How Financial Stress Can Impact Mental Health—and Steps to Achieve Peace of Mind

Bringing Financial Wellness to Your Workplace

Your Company's Next New Year's Resolution: Financial Wellness

How Financial Wellness Can Help You Through Stressful Holiday Spending

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.css-13o7eu2{display:block;}How Financial Stress Can Impact Mental Health—and Steps to Achieve Peace of Mind

Bringing Financial Wellness to Your Workplace

Your Company's Next New Year's Resolution: Financial Wellness

How Financial Wellness Can Help You Through Stressful Holiday Spending

Newfront for Businesses

Newfront for Employee Benefits

Newfront for Private Clients

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How Financial Stress Can Impact Mental Health—and Steps to Achieve Peace of Mind