Stressed about money? 4 steps from experts you can take to protect yourself
If you’re stressed about money, you’re not alone.
The WalletHub Economic Index, a monthly survey that evaluates the economy based on how people feel, found consumers are 7% more stressed about money than this time last year and 6% are less optimistic about their finances.
People are also less interested in large purchases, with the likelihood of making a large purchase over the next six months about 7% lower, and those expecting to buy a car in the same timeframe roughly 6% lower. Plus, people’s sense of job security is 5.2% lower.
A June forecast from Deloitte showed the economy “slowing substantially” for the last half of the year.
One positive note: interest in home-buying is up by 4%.
“The truth is you cannot entirely protect yourself from uncertainty, and if you do get close to being risk-free, you will earn such low returns that you will not meet your financial goals, such as retirement,” Bradley Stevenson, associate professor of finance at Bellarmine University, said in a statement to WalletHub.
If you’re stressed about money, this is what you can do about it.
What can you do?
Here’s what WalletHub’s experts suggest you do if you’re stressed about money.
“All the old maxims we’ve been using since biblical times still apply even today,” Harlan Holt, senior data scientist at Ocurate and former professor at Union College, said in a statement to WalletHub. “Save money, have yourself a war chest for an unexpected layoff, plan for the future, invest in yourself, obtain new skills that you think will be useful in the future.”
- First: Savings. An emergency fund is crucial. Generally, this is three to six months of expenses in an account you can access easily, such as a high-yield savings account. If you can, try putting 10% of your income automatically into that account so you don’t even have to think about it.
- Second: Diversification. Diversification means you don’t put all your eggs in one basket, which helps mitigate risk when investing.
- Third: Evaluate any debt and that interest rate. You should try to pay off high interest debt such as credit cards as soon as you can.
- Four: Obtain new skills, such as through job training programs or a certification course, to prepare yourself for an unexpected layoff.
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This story was originally published August 17, 2023 at 4:43 PM with the headline "Stressed about money? 4 steps from experts you can take to protect yourself."
