How to Bring Simplicity and Certainty to Your Finances

Financial anxiety rarely comes from the numbers. Those figures on your bank statements are not what’s keeping you up at night. For most people, financial anxiety has its roots in uncertainty. The stress comes from not ever being sure of what might happen next, be it job insecurity, rising bills or the unpredictable housing market.

In this article, we’ll look at ways to simplify your finances and regain some of that financial certainty.

The emotional cost of financial uncertainty

If you find yourself awake in the middle of the night, worrying about money, you are not alone. One UK-based survey found that around 31% of adults feel anxious and 26% feel stressed about their financial situation, with nearly half reporting increased worry compared with previous years. Significant numbers of people said it was having an impact on their physical and mental health and on their sleep.

It’s not specifically a low income that triggers these feelings though, it’s the perceived instability. You could be a two-income family, a homeowner and have a relatively high standard of living and still feel vulnerable. 

How to tackle this uncertainty

Knowledge is power. We feel unsafe when we’re unsure, so taking as much control as you can will make you feel more comfortable, regardless of your income.

See the big picture

Set aside time to look at exactly how much money you have coming in and going out every month. Include everything you can think of, even small things like coffee on the way to work. 

From this, identify any low-hanging fruit. There will be some quick wins where you can reduce costs immediately. This could include cancelling unused subscriptions and reviewing and switching deals with energy, internet, insurance and phone contracts.

Then create a budget, detailing what you plan to spend where.

Hold yourself accountable

Set yourself realistic but actionable goals. Having a mental list of ‘shoulds’ creates mental clutter, so attach dates. Turn ‘shop around for better mortage deals’ into ‘I’ll review my mortgage by the end of next month’. Tick things off when they’re done.

Choose certainty when timing matters

Time pressure can add an extra layer of stress to a big financial decision. The traditional route to selling a home for example has a huge amount of unknowns around it, so look at alternative methods if you know the stress is going to make it unmanageable for you.

Options like cash buyers for houses – companies that purchase directly without mortgage chains or prolonged negotiations – could work well if you like certainty, as they guarantee a sale price and let you set your own completion date.

Separate emotion from strategy

This is a tricky one. Feelings about money often become entwined with other emotions like guilt and shame and it’s useful to understand how these impact your spending.

When decision making, try to separate your feelings from the practical stuff by keeping financial planning very matter-of-fact. Write lists, identify pros and cons and weigh up options objectively. 

If you’ve decided it’s time to take charge of your finances then congratulations. You’ve taken the first step to pulling your head out of the sand, regaining control and getting a better night’s sleep.