The unforeseen circumstances of 2020 have impacted the world in many ways, we think it's important to take the time to check in with yourself to ensure you are looking after your physical and emotional wellbeing.
We know that finances can often be a source of anxiety, now more than ever, so we asked financial expert Chelsea Murphy from Cash Full Stop for her tips on how to take control, ease anxiety surrounding your finances and help navigate you back to a place of financial confidence.
This first step can feel confronting (and possibly messy) but it’s about exploring every financial responsibility you have. You want to be clear on what you owe, in every facet of your life – housing, utilities, credit arrangements like credit cards as well as buy now and pay later options, medical, family responsibilities, transport, as well as ad hoc or infrequent payments like annual fees or bills. Write them down, every single one.
Also think about the services that are financially on hold but will recommence as restrictions are lifted. You want one complete list so you can see what you’re expected to pay out over the next 6 to 12 months.
Next you want to list your assets and income. Write down everything you have in terms of assets as well as all your current/expected income streams. If there are any that are time specific, then write down the date they start/conclude so you have that clear context.
This is your list of all money movements for the next six months, so you know exactly what is coming in, and out. The AOL diary budgeting section will also help with this. Sit with it. And, breathe.
Stress Less. Plan More.
You now know the actual numbers of what’s coming in and out, this gives you clarity. The next step is to create a plan. But before the plan ask yourself what you want to achieve, the last couple of months have given lots of people the opportunity to reset. What do you want to restart as the world opens up? So many things were done by default, but we can take this moment to be more selective. Personally, what is important to you from this moment forward?
You’ve got clear data on where you are so now you need a clear and achievable plan. Financially if there are periods where financially what’s going out is less than what’s coming in then you need to make a clear financial plan. Do your savings cover the shortfall? If not, this is the time to think creatively. What can you do to manage the variance? Some incredible businesses are born in economically challenging times so don’t feel constrained, be open to new opportunities, it’s the time to be resourceful. How are you going to survive and thrive in the next 6 to twelve months? You don’t have to do this planning alone, chat to trusted friends, family or a professional to help. It’s important to set yourself clear spending guides and a structure that helps you easily keep to your plan also.
Your plan needs attention and focus to go from paper to reality. It’s about the small things as much it is about the big things. Set a weekly check in date with yourself so you can see how things are going. Gauge how you’re feeling. Seeing things move in the direction you expect will give you financial confidence and peace of mind. It’s as simple as one good decision after another. If you’re still feeling overwhelmed then talk to your support network, there are a lot of people in a similar situation right now so find those pillars of support to help each other through positively.
Another valuable activity to help you maintain positive attention on your money journey is gratitude. Documenting your appreciation for all the amazing things in your life that your time, attention, effort and money have provided give you a regular perspective on something present and positive. If you want to explore gratitude more, this is the post for you.