Managing anxiety has a positive impact on your health, but there's an additional benefit: it can also improve your financial wellness without any additional action on your part. Here's how:
#1: Better Decision-Making
When you feel anxious, it's easier for your judgment to be impaired, which can lead to impulsive financial decisions. Managing anxiety supports your ability to make rational, well-informed choices about spending, saving, and investing.
#2: Reduced Debt-Related Stress
Anxiety often makes debt-related stress worse. Effectively managing anxiety allows you the head space to address debt proactively and develop repayment strategies. These first steps alone will help reduce the mental burden associated with owing money.
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#3: Fewer Impulse Purchases and Emotional Spending
One of the ways people deal with anxiety is by developing coping mechanisms. Some coping mechanisms include impulse buying and emotional spending, and are easily triggered when we are feeling anxious. Finding effective ways to manage anxiety helps us avoid impulsive purchases driven by stress or negative emotions, leading to better control over our budget.
#4: Increased Likelihood of Sticking to a Budget
When you effectively manage anxiety, the resulting feelings of empowerment enable you to think positively of the future and plan ahead, necessary ingredients for establishing and sticking to a budget. Since budgeting is fundamental for financial wellness, sticking to a budget helps improve your financial wellness.
#5: The Right Amount of Risk
In many cases, anxiety alters our perception of risk. It can make us take more risk, or make us overly risk-averse in our financial decisions. When anxiety is effectively managed, we are more open to making informed decisions that support our future financial wellness and success.
Want to learn about effective ways to manage anxiety? Tips for coping with anxiety from the Mayo Clinic