Your Life

How to reduce your money anxiety

- April 27, 2021 4 MIN READ
Challenging to buy a home

Learning how to reduce your money anxiety is a critical life skill.

No matter where you are in life, if you look at life events and draw a timeline, it’s easy to identify several times where money created anxiety. This could be when it triggered an anxiety attack, or at the very least, significant levels of worry and stress.

Big milestone events like finding work, managing debts, marriage, divorce, kids, health, education and retirement are well-known sources of money anxiety. However, less significant things like getting the bills paid, having some savings or simply experiencing FOMO or a general feeling that you don’t have enough money, can also trigger internal turmoil.

Money is a major cause of stress and anxiety. Experiencing anxiety can add to your financial stress.

Anxiety is a state of inner turmoil.  It can make you sick and your life seem unbearable. It also makes you feel very scared. A sense of dread, fear that something is about to happen that will be unpleasant or plain terrible.

Anxiety can generate both physical and mental reactions. Yuck. That’s tough to manage. Worry is something more controllable than anxiety, yet both have significant links to money.

Many people experience financial worries and money anxiety.  According to NAB’s Australian Wellbeing Survey, around 40% of Australians are experiencing financial stress and hardship.  Despite the links between mental health and money, anxiety doesn’t discriminate – having wealth doesn’t mean you are safe from anxiety and having less doesn’t always induce it. All types of Spenditude can suffer.

How we can reduce our level of money anxiety and turmoil?  Can you lower the levels of worry by changing a couple of money habits?

Defenders, Spenders and Slenders

“Good with money types”, aka Defenders, can experience financial stress, despite their more natural tendency to manage their financial position.  Defenders often have a ‘safety limit’ and dropping below this can induce feelings of a loss of control.

Slenders are most impacted by noney anxiety, as they worry about spending and also worry about not defending.

Our dear Spenders can also become anxious if they spend their way into a bind where access to funds (and spending) is closed off.

Find out more here: Have you ever wondered why some people are just better with money?

‘Healthy Spenditude’, that is linked to happiness and purpose, can reduce the levels of financial stress and anxiety. Adopting a Defender’s value lens can also help.

A Defender’s value lens seems to come naturally to them. Considering time, purpose, tax breaks, discounts and delayed gratification are all in the remit of the Defender.  They quickly identify where the money is coming from – which account, which paycheck, etc – and make decisions accordingly.  Our Slenders and Spenders can adopt a mini value lens to feel less stressed and more empowered.

WATCH: Julie Lee helps us get to know our investment personality and explains why it matters:

Two quick tricks that we can learn from the Defender value lens:

1. When considering a purchase look at environmental impact first.

2. Consider how many hours work it takes to pay for it.

Two simple tricks that change spending habits.  Consider the purchase of a clothes dryer.  “I like the ones with all the options, buttons and the larger size means I can stuff everything in!”

Value lens 1 – consider the environmental rating

Value lens 2 – The dryer is a $900.  I know my after tax hourly rate is around $35 per hour.  There are 25 hours of work in that dryer.

The value lens creates pause, consideration.  Perhaps I should look elsewhere or consider eBay?  Do I need it now or can I wait? The value lens exercise is a great habit breaker.

A spender who adopts a mini value lens can feel very self fulfilled as they reflect on their renewed Spenditude.  They start to feel more empowered and less stressed.  Slenders and Spenders will have less money stress if they feel they are doing something a little savvy and purposeful (and it was easy).

More on this: Are you a Spender, a Slender or a Defender?

That is a habit changing Spenditude moment just there.  Don’t buy the fancy dryer because it will wreck the planet and if I do buy it, I will have to work three full days to pay for it.

Healthy Splenditude

So let’s get back to anxiety.  Inner turmoil, a sense of dread and fear. When do these feelings tend to appear?

For many it is when we are tired or have woken up at 3am.  The time of night when you panic and lose sleep, but accomplish nothing.

The Spenditude tip here is to practise better sleep hygiene. Considering the core habits of reducing screens before bed, avoiding alcohol and caffeine and considering the processes of winding down, perhaps some meditation and, of course, not restricting sleep by getting to bed too late.

A final tip to reduce those feelings of worry is to make sure you talk about money with your loved ones.   Don’t keep your inner turmoil locked up inside.  If you have a partner it may be he or she who is contributing to your anxiety.  Talk to them. Create a shared Spenditude.

If you can apply these tips you may avoid that inner turmoil and anxiety or worry.  Changing a couple of money habits and ensuring you are working on a clear mind through good sleep are the first steps to reducing financial stress.  The feeling of dread will begin to disappear as your Spenditude improves.  If you can reduce or eliminate the worry, your brain and your body will thank you.

We love hearing your spenditude tips and stories. How do you reduce financial stress?  Get in touch at