Among the biggest causes of stress, worry and anxiety is money. That’s because money isn’t just a practical part of our lives with purely logical, practical problems when it comes to managing income and expenses. Money’s also intricately tied up with our emotions and our childhood. And, to increase the load to overwhelming levels, the consequences of being without money are the stuff of nightmares: bankruptcy, homelessness, starvation and lack of medical treatment. So if we want to stop worrying about money, there’s a lot to work on first.
There may be affiliate links in this post from which I earn a small commission if you go on to make a purchase, at no extra cost to you.
How to stop worrying about money
I meet people in ELT all the time who are absolutely paralysed by all of this. The nature, precarity and low pay of ELT itself are to blame. But also this industry typically attracts Arts types with a sense of adventure and love of travel. Which works out great in your 20s, and is kinda, sorta functional in your early 30s.
But at some point, reality bites.
It’s hard to buy a house, support a family or retire on an ELT income without financial stability, savings, pensions and investments. All of that can feel too overwhelming to solve so panic and “head in the sand” sets in.
If that sounds like you, here are some concrete ways to stop the worry, get unstuck and start building a foundation with money. It’s never too late to improve your situation!
1 Build an Emergency fund
An Emergency fund’s aim is to cover 3–6 months of essential living costs, like rent, bills, food.
Once you have that set aside, you have way more peace of mind. Studies by Bristol University that followed people for ten years showed that even low earners with savings slept better and were more optimistic about the future than those without. More surprisingly, they were just as satisfied with life as high earners with no savings.
My survey of ELT professionals suggests over ¼ of us don’t have that which means a lot of people sleeping less well than they could be.
So the first thing you can do to stop worrying about money is to cover yourself in case of unpredictable expenses or losing your job or all your students. Ideally you’d keep this money in a separate account that you don’t dip into unless it’s an emergency. And it would be earning interest!
For tips on saving in ELT, here’s a blog post with ideas to make it easier.
8 ways to save money in ELT
2 Know your incomings and outgoings
People who are “good” with money know their monthly incomings and outgoings. At least for a while so you get familiar with your budget and spending, track these in a spreadsheet or just with pen and paper.
It’s tempting to just stick your head in the sand and hope there’s enough money each month but what you don’t know is scarier than you think because it means you have no way to control it. After a while, you may no longer need to track because you’ll have a much better sense of what’s going on.
Another thing you can do to stop worrying about money is to predict “knowable” but irregular expenses for the year.
If the boiler stops working or the car breaks down, what is a rough idea of how much a replacement would cost? How much is a last-minute flight home in high season?
You could open an instant access savings pot to cover these things, preferably in something where it can earn decent interest. Wise is what I use for holding pots in different currencies, all earning interest. Check to see if Wise interest is available in your country.
3 Put money to work
Once your Emergency fund is saved up, it doesn’t mean it’s time to stop saving. Your next priority wants to be putting money some place it can grow, be that a pension and/or general investing accounts.
Learning the very simplest basics about the stock market will help you realise this isn’t a scary thing to do (even pensions put some of your money into stocks and shares).
You don’t have to save large amounts but it does need to be a regular amount so you want to automate that so you don’t have to think about it. You’ll forget the money is even going out of your account each month.
Seeing that money earn interest over time and grow without you having to do anything will make you feel less powerless. And it might motivate you to make other changes in your life that increase your earning and saving potential – it’s had precisely that effect on some of the people who’ve taken my No-Stress Money Plan course.
Think you don’t earn enough to save?
I bet you do.
This FREE worksheet will help you work out where you can skim some money off your budget and how much it could earn if you put it to work.
4 View money as a tool
Our money mindset is a huge part of how we handle money. Whether you grew up with a lot of it or very little, your childhood and any later traumatic events relating to money imbue money with layers and layers of complex emotions. They influence whether you impulse spend, or cash hoard, or give it away. Learning what is at the root of your money mindset will help you detangle these emotions and master them.
And, once money is neutral, like any other tool, it’s a lot easier to develop habits to use it to its best advantage.
5 Make money appointments with … yourself
One thing that will take the emotions out of it is to set a date in your calendar every 6–12 months to review your finances. Use this slot for things like:
- Checking if your Emergency fund still meets your needs, either because your costs have gone up or down. For example, finishing paying a mortgage or a change in relationship status.
- Reviewing recurring payments, cancelling things you no longer use and looking for better deals on things like insurance or internet and utilities.
- Increasing or decreasing the amount going into savings and investments if your circumstances have changed.
Regular, scheduled reviews will become habitual and less emotive, and you’ll have a bird’s eye view on your money situation instead of an ostrich’s head in the sand.
For couples, money can be tricky and bring up all sorts of emotions and conflicts. But you can head off that source of potential arguments by talking about your attitudes towards money.
I guarantee you’ll learn something new about them with this set of conversation cards.
You could even use them in class (maybe take out a couple of the more personal ones first!).
6 But also … don’t look
If you have pensions and investments set up already, or you will soon (learning about how they work will make that so easy), there’s a crucial piece of advice so you worry less about them.
In contrast to the advice in #5 to track and review finances constantly, investments should be totally left alone. Other than making sure your automated payments are going out, it’s better to ignore your those accounts completely. The stock market will go up and down and that’s perfectly normal. But if you’re checking all the time, you might panic and take the money out at the wrong time, incurring losses.
It’s counter-intuitive and can be hard to believe until you understand how the stock market works. That’s why I teach investing psychology as a key part of The No-Stress Money Plan. But leaving it alone and letting it do its thing is where the growth comes from.