Money stress isn't just felt in your wallet. It follows you to work, to dinner and into your sleep. Many people who worry about money also avoid looking at their account, and then the worry grows from what stays hidden.
The research paints a mixed picture. In a study published in Science, people with lower incomes did worse on thinking tasks after first being asked to think about an expensive repair. A later study found no such difference in how well people thought before and after payday. What holds up is that unanswered money questions take up space, and that they shrink once they're written down and given a set time.
Pick one way to start:
- Write down the worry if your thoughts keep circling.
- The smallest step if you avoid bills and calls.
- A small buffer if every unexpected expense scares you.
- Talk to someone if you're carrying it alone.
A first step today: write down everything that worries you about money, one thing per line, and choose a time each week when you'll deal with the list.
If the worry keeps you awake or affects your daily life for weeks, talk to a doctor or health professional. If debt is the source, look for free debt advice.
Money stress is more than a feeling in your wallet. It follows you to work and into your sleep, and it makes it harder to tackle the very things that would ease it. The research on how much money worry affects thinking is mixed, but one thing holds up: unanswered money questions take up space in your head, and they shrink once they're written down and given a set time. This article covers what the studies show and don't show, four ways to reduce the stress, and when to get help. How stress works in the body is covered in managing stress.
Money worry takes up space in your head
When you worry about money, you think about it even while you're doing something else. A bill that hasn't been paid, an amount that won't last until the end of the month, a call you should make. Each of these questions lingers and nags at you, because it has no answer and no set time for dealing with it.
Many people handle the worry by avoiding it: the envelopes stay unopened, the banking app stays closed, the call gets put off. That brings relief in the moment, but the worry grows from what stays hidden. If you don't know how bad things are, you often imagine something worse than reality.
What the studies show and don't show
In 2013, Mani and colleagues published a widely discussed study in Science. Shoppers at a mall in the US were first asked to think about how they would pay for a car repair and then to solve reasoning and logic tasks. When the repair was expensive, those with lower incomes performed worse, while those with higher incomes did equally well regardless of the amount. Sugarcane farmers in India did better on the same kinds of tasks after the harvest, when they had money, than before it.
In 2016, Carvalho, Meier and Wang tested a related question with low-income households in the US, who answered a survey either before or after payday. They found no difference in how well participants handled the thinking tasks or made decisions. Before payday, however, they were more likely to choose less money now over more money later.
So it isn't certain that money worry makes you a worse thinker in general, and different study designs give different answers. But both studies suggest that not having enough money affects how you choose precisely when things are tightest. That's one reason to make your important money decisions ahead of time, when you're calm, rather than in the middle of the worry.
Four ways to reduce money stress
Choose based on what your stress looks like.
Write down the worry. For you if your thoughts keep circling around money. Write down every single thing that worries you, one per line, and set a time each week when you go through the list. When the worry pops up on another day, you can remind yourself that it has its time. First step: write the list tonight and choose the time.
The smallest step. For you if you avoid bills, envelopes and calls. Pick the item on your list that feels smallest and do it: open an envelope, log in to your bank, find out an amount. It's usually easier than you expected, and it makes the next step easier. First step: do one thing from the list today, the smallest one.
A small buffer. For you if every unexpected expense scares you. Even a small amount set aside changes how it feels when something breaks. How to get started is covered in the guide to saving money. First step: move an amount, however small, into a separate account.
Talk to someone. For you if you're carrying it alone, and this is the most demanding way because it means you have to tell someone. A partner, a friend, or free debt advice, which is available in many countries. Saying it out loud often makes it smaller, and the other person sometimes sees a way forward you hadn't seen. First step: decide who you'll talk to and when.
When the worry gets too big
Money worry that keeps you awake at night, leaves you without the energy for things you usually manage, or lasts for weeks is more than ordinary worry. Talk to a doctor or health professional. If you have thoughts of harming yourself, or if it's an emergency, call your local emergency number.
This article doesn't replace advice about your particular situation.
A first step today: write down everything that worries you about money, one thing per line, and choose a time each week when you'll deal with the list.
If you want to start from scratch with getting your finances in order, the series begins with personal finance.
This is the understanding and a first step. Atlas is where it becomes a habit. If you add Money as its own area, you'll find Buffer check, where you rate how well you'd handle an unexpected expense and see the curve over the weeks, along with Weekly review, as suggestions you can make your own. Try Atlas free for 7 days, and cancel whenever you like.