Financial Anxiety

Understanding Financial Anxiety & How to Buffer Against It

If you’ve been following the news, you’ve probably heard warnings about a looming recession or an economic downturn. These terms can be unsettling, and for many of you, they may trigger anxiety about job security, paying off debt, or providing for your family.

That feeling of stress you’re experiencing is called financial anxiety. When anxiety spikes, it becomes harder to make clear financial decisions, which can lead to impulsive choices (like panic-spending or selling investments too soon) or avoidant behaviors (like ignoring bills or avoiding financial discussions altogether). But the good news is that there are ways to buffer yourself from this anxiety.

I take a two-pronged approach: addressing the emotional and psychological side of money while also implementing practical financial steps to create stability.

Emotional & Psychological Strategies

• Develop a Mindfulness Practice

Financial anxiety isn’t just mental—it affects your body, too. When we’re stressed, our nervous system goes into overdrive, leading to muscle tension, increased heart rate, sleep disturbances, and even panic attacks. Developing mindfulness or meditation practices can help regulate your emotions and prevent stress from becoming overwhelming. Even simple deep-breathing exercises or short daily check-ins with yourself can make a difference.

• Reframe Negative Thoughts

Pay attention to the thoughts running through your mind:

• “I’ll never have enough.”

• “I’m never going to be financially secure.”

These thoughts can keep you stuck in fear and avoidance. Instead, try reframing them:

• “What do I have control over right now?”

• “What small, practical steps can I take today?”

Even if your financial situation hasn’t changed yet, shifting your mindset can help you respond more effectively to stress instead of shutting down.

• Unplug from the News & Social Media

If you find yourself doomscrolling financial news or social media and feeling more anxious afterward, take a break. Constant exposure to negative headlines can make financial anxiety worse, even if your personal situation hasn’t changed. Setting boundaries around news consumption can help you focus on what you can control.

• Seek Support from a Financial Therapist

Sometimes, financial anxiety runs deeper than just external circumstances. If money stress is significantly impacting your mental health or relationships, working with a financial therapist can help you explore the emotional side of money and develop a plan aligned with your values. You can find a financial therapist through the Financial Therapy Association.

Practical Financial Steps

• Create a Financial Plan

Having a clear budget, a debt repayment plan, and a financial roadmap can help you feel more in control. Even a simple plan can reduce uncertainty and give you a sense of direction.

• Build an Emergency Fund

Even small savings set aside for unexpected expenses can act as a buffer against financial stress. If you’re not sure where to start, aim for just $500–$1,000 as a first goal—having even a small cushion can make a big difference.

• Automate Your Finances

Automating savings, bill payments, and even debt payments can help reduce decision fatigue and prevent financial avoidance. By setting up automatic transfers, you’re prioritizing your financial stability without having to make constant, stressful choices.

Financial anxiety is real, but you don’t have to let it control your life. By combining emotional awareness with practical financial actions, you can navigate uncertainty with more confidence and resilience.