Another financial tip for people with Anxiety

So if you have frequented this blog you know that from time to time I give financial tips for people with Anxiety. I have been working in finance for nearly 30 years now (yes I am ancient). This is by no means a financial blog, you should take any advice you see on my blog as my opinion only.

This will be a very quick post. Why? Because many articles/posts on financial advice are very long and unnecessary. Simply put, it doesn’t take several paragraphs or a short novel to impart financial advice. We are in uncertain times, the market still marches on. The underlying economic foundations, are still pretty strong. Supply and demand is still there it has been bottle necked for months, it will come back.

That said, the financial cycle has many ups and downs. Timing is critical when investing. What about when you have anxiety? How do you navigate this atmosphere? Protests, pandemics, Presidential Elections…. What do you do?

Answer: You don’t invest.

*Gasp* I know crazy talk right? The finance industry will always tell you to invest, its how they make money. IF you are unsure what to do, you pile up cash in your checking and savings account. It’s better to stockpile cash then move into a risk position when you are risk adverse. Basically, if you are not comfortable investing and it is giving you anxiety, you pile up cash, and you can invest later.

Now you will not get rich this way, but you certainly will not go broke either. “Ya but those accounts get ..5% interest” yes that’s true but there is nearly no chance of you losing your money. The last thing you want to do as someone with anxiety is enter into new endeavors that increase your anxiety. Take your time, educate yourself and when you are ready you can invest.

The market will be there when you’re ready. Hang in there you are doing great.

Interested in more finance tips for people with anxiety? Check out my post here

Surge in anxiety from money worries due to pandemic

Found a very good article here that discusses the anxiety of many of our friends in the UK. The article did a good job of illustrating some of the nuances of income in a pandemic situation. What does it mean to be furloughed? Unemployed and the very real fear of being an essential worker and the risk of infection.

From the article: The survey’s finding suggested that more than 25 million people – 49.6% of over-16s in Britain – rated their anxiety as “high”, more than double the amount who did so at the end of 2019.

Those suffering the greatest level of worry were an estimated 2.6 million people who said they were struggling to pay bills.

The survey data suggested that 8.6 million people had seen their income fall, with this group also reporting anxiety levels 16% higher than average.

Women reported anxiety levels 24% higher than men on average, with the ONS saying the difference might be because a larger proportion of women were either economically inactive, in lower paid jobs or working part time.”

I love numbers and statistics and I think we can all agree it’s hardly surprising that anxiety levels are rising. To be clear, the statistics and numbers above are projected out based on the survey results. They didn’t speak to millions of people but it’s statistically viable to extrapolate it out to the larger population. Now keep in mind this is a study done in Britain, it’s not necessarily representative of the rest of the world.

That said economies are going in the wrong direction and incomes are being lost. We do touch a little bit on personal finance on this blog. What I can tell you is, I have lived through many market down turns that were not financially created.

As an example, 9/11 was not a business event but the market responded and people lost jobs. It’s the same with covid. The pandemic affected the economy drastically but the underlying economic foundations were in a decent place. Interest rates were low, consumer spending was up, and businesses were making good profits.

I know that’s little consultation if you lost your job and your anxiety is through the roof. This is a place where government can help citizens, extending unemployment benefits, ensuring companies have opportunity to stay open and requiring wait periods on landlords to evict are a few examples.

For the individual there isn’t a lot I can tell you. We all have different skill sets and coping mechanisms. I would offer you some hope in the sense that you aren’t alone. There are more people now with anxiety then in recent memory and awareness of the issue is higher than ever before.

There is one singular thing you can do for your financial stability and peace of mind. Have a fully funded emergency fund which should be minimally 1000, but ideally 6 month’s worth of your expense. I have a post on what an emergency fund is linked here.

If you have one great, if you don’t it should be one of your top financial goals. It will help you a great deal during the next crisis. Hang in there, things will get better, one day at a time.