All the talk of debt, inflation, the rising cost of living, rising energy prices and rising interest rates can cause a little catastrophising.
The tendency to think we’re all doomed and there’s no hope.
But there is always hope and your situation may not be as bad as you might think.
If you’re losing sleep or feeling stressed over money, you may not need to.
If you’re going without because you’re worried about money, you may be able to relax a little.
There are tangible, irrefutable signs your finances may not be as bad as you might think.
This should make you feel much more relaxed about the state of your finances and the world at large.
Here are a few of those signs:
You already use a household budget
I regard having a household budget as the cornerstone of financial management.
If you don’t know where you are, how can you possibly know where you’re going?
A budget shows in black and white how much money you have coming in and how much is going out.
It shows you how much you have left over or what cutbacks you’ll need to make to break even.
If you’re already using a household budget to manage your finances, you’re already exerting control so things are not as bad as you may think.
You have savings
Around 34% of British adults don’t have savings. If you do have savings, you’re one of the lucky ones.
If you’re exceptionally lucky, you’ll have 3-6 months outgoings in savings. If you’re very lucky, you’ll have 1 month.
If you have any savings at all, your financial situation is not as bad as you think.
Your debts are manageable
Most people have some kind of debt and having it is no issue. It’s not being able to manage debt that becomes an issue.
If you know where your money is going and can pay your bills on time each month, you’re in a good position.
It’s a position more and more Brits find themselves falling out of as time goes on and living costs rise.
If you’re struggling to pay your debts each month, that’s a different matter entirely, but if you’re getting by, you’re in a good position.
Your career has prospects
Much of our financial insecurity can stem from having jobs, not careers. Positions that could be dropped at a moment’s notice or be replaced by AI.
If you’re in a role that requires a lot of study or training and will continue to be relevant for the foreseeable future, you’re in a good position.
Millions of people are not in that position and feel vulnerable and stressed as a result.
If you’re not, that’s great news!
You have good spending habits
Our relationship with money can be complex. Some people are in control of it, while others have it control them.
If you can pick and choose when to spend and know to not spend more than you have, you’re in a good position.
Too many people have little self-control when it comes to spending. Others are more susceptible to peer pressure or keeping up with the Joneses to remain in credit at the end of the month.
Your financial position might be better than you think!
If you recognise any of these signs, your financial position may be better than you imagine.
If you have savings, don’t end each month in debt and can pay everyone without going into the red, there’s no need for sleepless nights or feeling stressed about money.
There’s plenty enough in life to feel stressed about without worrying about things you don’t need to!
