Does the idea of checking your bank balance leave you in a cold sweat or with a feeling of dread?

If it does, you could be suffering from ‘overwhelm’.

The technical term for overwhelm is financial anxiety. First, you need to understand that anxiety is a normal emotion.

It’s a healthy, temporary response to stress, and it shows up in the way we think, feel, and behave.

It’s anxiety that gives you the sweaty palms, dry mouth and dread feeling in your tummy you get before you make a speech or do something outside your comfort zone.

We’ve all felt like this and it’s fine. In small doses anxiety can be beneficial.

With financial anxiety you feel the same – on edge, nervous and worried about money – and the feeling isn’t going away.

We’re seeing more overwhelm

It’s not too surprising that after two years of living in a pandemic, financial therapists like me are seeing more cases of financial anxiety.

In April 2020, not that far into the pandemic, the Financial Therapy Association noted that financial anxiety was ranked number two in terms of what is stressing Americans out. I think it would be the same here in New Zealand.

Before I go any further, let me just bust a myth. Financial anxiety doesn’t just happen to people who are struggling financially. It can hit you regardless of your net worth, income, or financial stability.

Know the signs

How can you tell when overwhelm is affecting your life?

When we are feeling anxious, we go into Fight, Flight, or Freeze mode.

We do things to make the anxiety go away. We make unwise choices: like sitting on the couch watching Netflix with a bag of potato chips instead of heading out for a walk and getting some fresh air and exercise. From a financial perspective, this can lead us to make irrational decisions, like buying a brand-new big-screen TV when we’re facing job uncertainty and we’re worried about paying our rent.

We don’t think through our decisions, or we’re paralysed and avoid making any decisions at all.

These symptoms can all have a long-term impact on our future financial security.

Distorted thoughts

We get caught up in the Thought – Feeling – Behaviour cycle. Our thoughts become distorted, or just not true – but we think they’re true.

We tell ourselves: “I’ll never get my spending under control. I’m doomed, I’ll never have enough money for retirement. I’ll never be able to buy a house. I’m such an idiot.”

Then the anxious feelings kick in. We worry, we feel on edge and nervous.

This can also show up physically with a tightness in the chest or throat, stomach aches, tension, or headaches.

You may notice these feelings more when it’s time to pay the bills, log into your bank account, or when you need to have a conversation about money with your partner, or boss.

If you’re waking up in the night with your stomach churning because you’re worrying about money, that’s a pretty good indicator that you have some level of financial anxiety going on in your life.

Two sides of the story

The two ends of the behaviour’s spectrum are ‘perfectionism’ or ‘procrastination’.

• Perfectionism shows up as being super-organised, rigid, and inflexible. You’re over-researching everything, constantly refreshing and checking banking apps to make sure everything is correct.
• Procrastination is just not starting things: “I’ll do it tomorrow”. And as we know, tomorrow never comes. So, you don’t cancel subscriptions you no longer need. You don’t fill in the forms to increase your KiwiSaver contributions. You don’t look at your banking app and you continue to overspend.

Take back control

How can you take back control of your life and commitments?

Recognising you have the signs of financial anxiety is a good place to start. Realise it’s just a stage.

You can move through it and come out the other side. You might just need some help and some tactics to help relieve the anxiety.

Listen to your thoughts. Have a conversation with yourself and find proof against the thought.

How true is the thought, “I’ll never get my spending under control”? Think of times when you haven’t spent all your money.

Be aware of your feelings. If your heart is racing before you open your banking app, take a few deep breaths first and ground yourself in the here and now, not the past or future.

If you’re stuck in perfectionism, set yourself a challenge to not open your banking app for 24 hours. Set some boundaries to slow yourself down.

If you’re procrastinating, you need to do the opposite. Set a time to do whatever it is you need to do. Start with a tiny 10-minute task and build up from there. You might need to set an alarm to make sure you do it!

Do I need help?

If anxiety isn’t dealt with, it can spiral out of control into depression. Don’t let it get that far.

If the techniques I’ve suggested aren’t helping, and you’re feeling even more anxious, then ask for help.

Talk to your partner, a close friend, your GP, or a financial therapist. Find someone you can trust to have an honest and open conversation with about how you’re feeling.

This is not the time for a stiff upper lip, fix-it-myself mentality. At some point in our lives we’ll all feel financial anxiety, even if just briefly.

Help others, too

If you see warning signs in others, ask if they’re okay.

Don’t push your views or offers of help too hard, as you may not know which stage they’re in – fight, flight, or freeze.

Suggest they get some help. When they’re ready to face their anxiety, let them know you’re there to support and help them in any way you can.