Cut Your Financial Stress In Half

What makes us most worried about money? Partly it’s about having the things we want, or at least the things our neighbors seem to have.

Debt is another source of stress. We know carrying credit card debt is bad for our financial health. Not being able to pay them down can be a drag on our spirits.

Paying bills on time is another. Of course, looming in the background is the really big stress point: retirement. We know we need to save more today, not later. Yet the here-and-now problems in our financial lives always seem to take precedence.

So we put the cart before the horse, time and time again. How can you cut your financial stress in half? But tackling the big things first:

1. Set up automatic savings

The quickest route to feeling better about your retirement picture is to set it and forget it. If you have a workplace 401(k) and don’t contribute, start. If you do and don’t maximize, get on a path to as much savings as possible. Set a date, write it down: “By July 1 I will save 10% of my income, by New Year’s I will max out.”

2. Get the most out of workplace benefits

People often go to their work benefits enrollment meetings, get handed a folder crammed with photocopied sheets and zone out. Don’t be that person. Read about matching contributions for which you might qualify (free money!). Find out about tax breaks for childcare you already pay for and possibly the benefits of a pre-tax health savings account.

3. Plan to be debt-free this year

It really is important to write down numbers: How much you owe and how long it will take to be debt-free. Figure out the number of months that is and put it on your calendar. Then either refinance your debt or get aggressive about paying it down. You will feel amazing when the number is zero.

4. Find the loose change in your daily life

Look at your household bills each month and each quarter. Really scrutinize your spending. Joined a gym and don’t go? Cancel it. Fifteen channels of pay TV you don’t watch? Kill it. Landline and a mobile contract? One should go. Every cent you spend blindly is wasted.

5. Learn to be happy with what you have

This is the hardest step but truly the key to ending financial stress. Once you accept that retiring on time is more important to you than a newer car or a fancier vacation, it gets easier to deal with your brother-in-law’s new toy or your co-worker’s stylish new clothes. Chances are, they have bupkis in the bank. Realizing that is an important step forward.

Once you get your head right about money, the stress will fall away. You will enjoy many aspects of your life and work in ways that might be hard to imagine now. And you’ll be a nicer person by far, mostly because other people will be unable to bother you with their financial showboating.