Managing Stress by Managing your Money

1. Managing Stress by Managing your Money Steps to More Effective Money Management

2. Sometimes when people are under stress, they hate to think, and it's the time when they most need to think. ~Bill Clinton

3. Stress and Money Management • Financial stress is one of the leading causes of stress in Americans. • Stress is linked to health problems: • Unhealthy coping behaviors which leads to more stress. Ex. Smoking, drinking, overeating. • Less money for health care. • Loss of sleep. • Depression. • You can reduce your financial stress by learning how to manage your money more effectively.

4. How Do You Manage Your Money? • Do you manage your money so you can pay for your needs and wants? • Answer the following questions with either a YES, SOMETIMES, or a NO. Yes = 3 points Sometimes = 2 points No = 1 point

5. Quiz Time! • I pay the rent or mortgage payment and utility bills when they are due. • I plan ahead for big expenses. Ex. Insurance premiums, buying another car, etc. • I have a plan for how take-home pay will be spent. • I save 10 percent of my take-home pay. • I keep receipts, check stubs, etc. as records of payment and to use when figuring income tax.

6. Quiz Time! • I get interest rates from different lenders; credit unions, banks, etc; before deciding where to borrow money. • I compare prices at two or more stores before deciding to buy expensive clothes, furnishings, etc. • I have insurance to cover debts I owe, funeral and burial costs, and injury I might cause others. • I spend no more than 15 percent of my take-home pay on installment payments (not mortgage payments).

7. How Did You Score? • 22-27 points – you are trying to manage your money and probably have control over your financial situation. • 13-21 points – you need to improve your money management practices. • 7-12 points – you need to increase your knowledge and skills if you want to improve your money managing skills.

8. What Now? • The first thing to do to get your money working for you is to know how you want it to work. • Decide what is important to you—now, 5 years from now, and later. • Set realistic goals

9. Needs and Wants Are NOTthe Same Thing! • Spend money on your needs FIRST! • Basic needs include: basic food, basic clothing, basic shelter, basic transportation, taxes, insurance, and savings.

10. Know the Flow • Know what money comes in • You can only spend what you take home, if you spend more you’re going into debt! • Know what money goes out • List all payments you make each month. • Track what you actually spend on food, recreation, and other items for a week. • Multiply this number by 4 to get a monthly total.

11. Final Steps • Create a spending plan. This will help you: • Stay out of debt • Avoid impulse spending • Save money for long-term goals • Identify areas for potential savings • Establish financial control and direction

12. Final Steps • Pay Yourself First • Put at least 10% of take-home pay into savings. • Savings can be a life raft in emergencies like accidents, illness, or unemployment. • It’s recommended to have 3 to 6 months of expenses in savings.

13. All the Steps

14. Sources • http://www.wellnessproposals.com/financial-fitness/financial-wellness-handouts/money-management-to-get-what-you-want.pdf • http://www.quotegarden.com/money.html • http://www.youngmoney.com/credit_debt/money_management/budgeting/020809_06/ • http://stress.about.com/od/financialstress/a/financialstress.htm