Breathing through it
This is a world none of us have navigated before. If taking a close look at your financial habits feels overwhelming right now, you are not alone. Perhaps you temporarily lost part of your income or all of it. Anxiety is almost unavoidable, and can make us instinctively want to turn away. In our brains our finances are linked to survival. When we feel “money stress” or fear a shortage, a fight or flight response can easily be triggered. Once triggered we are not able to make rational intentional decisions. It is important we bring ourselves back, out of our instinctive brain and into our thinking brain. Making money decisions from a fearful or impulsive mindset is likely to cost us.
A simple breathing exercise can relax the nervous system and take us out of fight or flight. Try inhaling deeply for a count of two and exhaling slowly for a count of four. Then inhale for a count of three and exhale for a count of six. Continue until you are inhaling for five and exhaling for ten. Do this for a few minutes—the goal is to slowly extend your exhale in relation to your inhale. Try expanding and contracting your diaphragm when you breath, letting the lower belly rise and fall. After this exercise, you should feel calmer and more grounded. The benefits of diaphragmatic breathing are described in a very informative series The Vagus Nerve Survival Guide from Psychology Today. You can use this breathing exercise anytime you need to find focus.
Taking a Look
Now hopefully you feel ready to seek clarity so you can take grounded actions that will better serve you. Review your credit card statement from a month that represents typical spending for you. Most banking websites allow you to download your statement into an easy to use spreadsheet format. Downloading language can differ from bank to bank so look for options like “download transactions” or “download account detail.” Once saved to your computer, lets get to work. Label each expense N for need—something that you have to spend money on every month like rent or utilities, and C for choice—something that is more of a decision like a new video game or a manicure. Sort for all your C items.
Now its time to take a look. For all those choice items, label them on a scale from 1-5— 5 if it brought you joy in hindsight, and 1 if it was money you really wish you had not spent. Maybe your manicure chipped a few hours later and it felt wasteful – give that a 1. Perhaps you ate an amazing meal with friends and had great memories from an enjoyable night out – rate that a 5. What items could you eliminate altogether? What items could you change to align more with your beliefs and values? Perhaps you still want a latte every morning but decide its worth adding a few extra minutes to your commute so you can hit up that local spot and support a small business. Perhaps you commit to brewing at home—saving 25 bucks a week. That’s 1,300 dollars a year! Use this rating system to help you thoughtfully consider where to make changes.
Though this exercise may seem unpleasant or daunting if you have never tried it before, you will likely feel better afterwards. In this way, you can reduce your money stress. Clarity brings calm. Action makes us feel empowered. We connect to our true power when our financial life aligns with our beliefs and goals. The results will be personal—your needs and choices are unique to you.
