If your finances are a constant source of stress and anxiety, you’re certainly not alone. In fact, 40 percent of American adults say they would have a tough time covering an unexpected expense of $400 or more, according to the Federal Reserve’s Report on the Economic Well-Being of U.S. Households in 2017. Furthermore, 1 in 10 adults says they struggled to pay their bills at least once in the past year due to varying income.
A sobering truth bomb? Reducing financial stress when you don’t make enough is nearly impossible, explains Emily Guy Birken, author of End Financial Stress Now. “Even the kind of frugality that will theoretically bring you some relief will often require an investment of time or finances—and lacking money and time is exactly why you’re feeling overwhelmed.” (Cue the #facepalm.)
But instead of indulging in a self-pity party, there are a handful of things you can do today, regardless of your circumstances. To reduce money-related stress, to start Guy Birken recommends building some slack into your budget, which is possible at any income. Here are five simple ways to reduce stress about your money situation:
Adjust Your Tax Withholding
Do you normally receive a large tax refund every April? The average refund in 2018 was $2,895, which works out to more than $200 per month. Adjust your withholding so that you’re taking more money home from every paycheck, suggests Guy Birken. “How much more comfortable would you be if you could count on an additional $200 each month?”
To adjust your withholding, request a new W-4 from your Human Resources department and determine the proper number of allowances you should claim using the IRS calculator. “Making this adjustment is perfectly legal and an excellent way to increase your monthly net without having to earn more money or cut your spending,” says Guy Birken. “But just remember there’s a trade-off: It also means you won’t get a big payday from Uncle Sam at tax time.”
Start a Surprise Fund
A surprise fund is money that you conveniently forgot you had. While not intended to be as robust as your emergency fund, a surprise fund can help smooth out any small hiccups you may face money-wise.
I’m a big fan of “set-it-and-forget” it methods. By setting your savings on autopilot, that’s less mental energy you need to spend on making everyday decisions. Plus, you’ll be making steady headway without having to lift a finger.
Over the years I’ve relied on “surprise” funds to cover a small unexpected expense, or if I’m having a particularly “spendy” month. It’s prevented me from putting more on my credit cards than I can reasonably afford. The easiest way to create a surprise fund is to kick-start a savings account, then auto-save every week. Even if you sock away $5 a week, that’s $260 you can tap into should the need arises (and it will). Up your weekly auto-save amount to $10 a week, and that’s $520. That could help cover your bills or pay for groceries during a particularly lean month.
Negotiate Your Bills
Easy wins in creating some slack in your finances include negotiating your bills, suggests Guy Birken. They’re considered easy because you technically only have to do it once. And because they’re recurring, that $20 you save every month on your cable bill comes out to $240 a year. “Internet, cable, cell phone, and auto insurance are service providers that are willing to adjust their pricing in order to keep customers,” says Guy Birken. “It costs them far more to land a customer than it does to keep a current one happy.”
Guy Birken recommends researching the lowest going rate for these services before you call. That way you know where you stand. And don’t be afraid to walk away if the provider isn’t willing to budge.
And while these are the easiest providers to negotiate with, don’t be afraid to ask for price breaks elsewhere—from your landlord to your healthcare provider,” says “Guy Birken.
Pro tip: You can also ask for discounts based on group affiliation. For instance, you may get a discount on your cell phone for being, say, a card-carrying AAA or AARP member or being affiliated with the military or a university. You may also be able to snag a slight discount if you sign up for auto pay, or opt for a different payment plan.
Cancel Unused Subscriptions
It can be easy to forget about the services we have signed up for, especially since so much is subscription-based these days, explains Guy Birken. Look through your credit card and bank statements and hunt for unnecessary services you’re still paying for and call to cancel.
Subscriptions you set on auto-pay are easy to overlook. One easy thing you can do is set subscriptions so they don’t auto-renewal. When you receive notification that your subscription is about to expire, that’ll give you a chance to gauge whether you need it or not.
Also look for services that you’re doubling up on. Do you really need a subscription to three different gaming platforms, or will only one do? Or let’s say you have a gym subscription and are also part of a local softball league. If you’re getting sufficient exercise by playing softball, you might be able to cancel your gym subscription.
Check Your Bank Balance
Ever feel blindsided by how much you’ve been spending—or rather, how little you’ve been saving? Avoid costly overdraft fees and feeling cash-strapped by month’s end by checking your balance on the regular. It only takes a minute but could help keep you mindful of how much you have in the bank.
This is something I do every morning. You can either log on to your banking app or through a money management app. If you find yourself running dangerously low on funds, then you can be more diligent about your spending. For instance, if I’m having a particularly “top-heavy” month in terms of spending, I’ll tone it done for the second half.
As you can see, you don’t necessarily have to get a huge raise or side hustle like crazy to alleviate financial stress. By doing these small things, you can build that slack that adds a bit of buffer in your budget—and helps you breathe a little easier.