Credit: khaowkhaoyai via FreePik
It’s tough handling your family’s finances these days, isn’t it? Things still aren’t back to normal after the pandemic, and there’s the threat of a recession soon. Meanwhile, inflation has made everything cost more.
If you’re stressed, you aren’t alone. A survey completed by the Canadian Financial Wellness Lab at Western University shows 60% of Canadians are more stressed about money now than last year.
While financial stress may be common right now, it isn’t normal, so it’s important you get a handle on it. Here are three financial fundamentals that can bring you back in control and reduce your stress.
Table of Contents
Use a Budget
A budget is one of the most supportive financial tools you can have during times of economic uncertainty. It shows you how much money you have to spend, so you don’t spend more than you should.
Start by tracking your spending over the past three to six months. This will give you a good idea of how you spend your money on a typical day.
Be on the lookout for recurring, non-essential spending. Reducing these expenses can free up more cash for the essentials. But don’t be afraid to look at your essentials, too. If you’re willing to make big lifestyle changes, you might be able to save on rent or insurance by moving or selling your second car.
Prepare for the Unexpected
Being prepared is a mom’s motto. It’s why you keep your purse fully stocked with snacks, hand sanitizer, and a first-aid kit any time you leave the house. You carry these items just in case your kids get hungry or messy while you’re out.
Applying this “just-in-case” mindset to your finances can help you weather unexpected storms. But instead of supplies in your purse, you have an emergency fund and line of credit in your toolkit.
An emergency fund is your first line of defense against the unexpected. These “just-in-case” savings can help you covered expenses you didn’t think to include in your budget — like your minivan breaking down after its usual tune-up.
A line of credit fills in when your savings fall flat. If you don’t have one already, consider visiting a lender like Fora to learn more about this option. This lender provides simple resources for all lines of credit in general, and the rates and terms of their online loans. To see if a line of credit is for you, check out Fora Credit for more information.
A line of credit can be a helpful addition to your financial toolkit even after the dust has settled on your emergency. It stays open as long as you pay off your balance, so you can tap into it again the next time your savings aren’t enough.
Go Beyond the Day-to-Day
When money’s a stressor, it’s understandable that you don’t want to think about it beyond the day-to-day necessities. But you have to start thinking about the long-term if you ever expect to drop your financial stress.
One day, your kids are going to want to go to university, and you’ll want to retire. Planning for these big life events is easier the earlier you start.
Take the time to research Registered Education Savings Plans (RESPs) and Registered Retirement Savings Plans (RRSPs). These are tax-advantaged funds that make saving easier because they earn higher interest than the average basic savings account.
Bottom Line:
A budget, safety nets, and long-term savings can help you feel more in control of your finances. This can help you banish financial stress once and for all. What did you learn from these Financial Fundamentals Every Stressed Mom Should Know?
