5 Steps to Reducing Financial Stress
There’s a funny saying that goes like this: “It’s easy to meet expenses… they’re everywhere!”. Jokes apart, it’s a fact that Financial Stress has reached epidemic proportion these days. One the one hand, we have social media fuelled consumerism and easy borrowing; on the other, we have burgeoning inflation and a tepid job market. In this day and age, the management of Financial Stress becomes absolutely critical. Here are five ways you can do so.
Prepare a Roadmap
All good things… begin with a Financial Plan! Indeed, having a documented plan in place to achieve your critical goals such as your child’s education & marriage, your retirement, or prepaying your home loan can take the edge off your financial stress and even encourage guilt-free spending. You’ll feel a lot more in control of your finances when you’ve worked with a qualified Financial Advisor on a Financial Plan.
Cover Your Bases
Leaving your bases uncovered when it comes to mitigating risks, can lead to severe Financial Stress. At the back of your mind, you’ll always worry about a medical emergency, damage to your car or home, or even a potentially fatal accident drying up your family’s income stream. Make sure you’ve got your bases covered when it comes to adequate health & term insurance.
Cut up Your Extra Credit Cards
Credit cards, although a fantastic convenience tool, could also become a pernicious trap if you hold too many. One Visa, One Mastercard and One AmEx are absolutely all that you need. Cut up the rest in order to circumvent the trap of overleveraging that could have you running around in circles of revolving credit.
Nurture your Credit Score
High CIBIL and Experian scores are vital components of a low-financial stress life. Why, you might ask? Because if your credit scores are good, you know in the back of your mind that you’ll always have access to funds in case of a dire emergency. To keep your credit scores high, you need to do the following. First, take a loan! (such as a car loan). Second, make sure you clear your loan EMI’s and credit card dues well in time. Third, keep your credit card utilisation levels less than 40% of your overall limit (for example, if your overall limit on a card is Rs. 50,000, make sure you don’t spend more than Rs. 20,000 on that card in a month.
Hire an Advisor
Last but not the least, enlist a qualified Financial Advisor. Preferable, seek out someone who has been referred by a friend who has already experienced their services. The support of a conflict-free Financial Advisor can prove vital in helping you keep your financial stress levels in check.