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Money stress, Financial understanding, Talking about money

The American Psychological Association (APA) just released its report: Stress in America: Our Health At Risk. Of course, the number one cause of stress is money.

What’s Causing Stress in America?

The APA stress report finds sources of stress are:

  1. money stress (75 percent)
  2. work stress (70 percent)
  3. economic stress (67 percent)
  4. stress from relationships (58 percent)
  5. family responsibilities stress (57 percent)
  6. family health problems stress (53 percent)
  7. personal health concerns stress (53 percent)
  8. job stability stress (49 percent)
  9. stress from housing costs (49 percent)
  10. personal safety stress (32 percent)

Money stress and talking about money in relationshipsInterestingly, almost all of the top 10 stressors in America relate to money. Concern about money plays a related role with work stress and economic worries. When it comes to couples’ problems, the number one issue about which couples fight is money. Those fights result in marriage money problems. It may mean marriage counseling, separation or divorce.
Of course, a bad economy compounds the overlap between work and relationships. For example, being laid off has major effects for a relationship, be it a marriage, dating or how one relates to parents or kids. Housing costs (and home foreclosure) are certainly part of the picture when it comes to money stress. And, of course, money and medical bills are probably a factor in the stressors that deal with health concerns. Health issues are, after all, a huge cause of financial hardship, bankruptcy and divorce.
The concern about money is a consistent worry across generations. The study found that money was the top cause of stress for the following cohorts:

Millennials – 80 percent
Gen X – 77 percent
Boomers – 77 percent

Ways to overcome stress; Money Habitudes and money stress

  1. Financial understanding and self-awareness: Stress comes from the unknown, uncertainty. Why are we in debt? How can I make more money? How can I save more? Why are we broke? As a sort of money personality test, Money Habitudes helps people understand their money habits and attitudes. It helps people see in an easy, nonjudgmental way how they spend and save money. It also shows: why they spend the way they do, with whom they spend in ways that make them feel good, when they spend or save in ways that will help their finances, and where they are that changes the way they spend, save, invest, go into debt, give to others, etc. Do you spend smartly when you’re with your sister but poorly when you go to the mall with your friends? Do you save responsibly all year only to go into debt giving gifts during the holidays?
  2. Money talk: Not being able to talk about money causes stress. That’s especially true if you share finances with a spouse or partner and make joint financial decisions. Not being able to communicate about money can translate to other relationship issues: a lack of trust, lack of connection, etc. As an ice breaker and conversation starter, Money Habitudes cards provide a healthy framework to talk about money. It’s the reason that it’s used by couples at home and by professional therapists in marriage counseling and conflict resolution sessions. People often say the conversation sparked by using the interactive cards was the best they’d ever had about their money and personal finances. It may not be the only step, but it is a good first step when it comes to relationship money problems. It also helps people frame their money issues, making it easier to talk with a professional, such as a therapist, financial educator, credit counselor or financial planner.
  3. Sharing and talking about money: In addition to just talking about money, the couples game, helps couples share money secrets. It’s awkward, uncommon and hard to, out of the blue, say, “I have debt,” or “My credit score is bad.” It becomes easier to talk about financial issues when they’re in context and there’s an easy way to tell a story. Of course, it becomes harder – and more stressful – to reveal money secrets as time goes by. Couples who get married without asking each other about their finances or sharing how much they owe and what they own may learn about their partner’s bad credit score or bankruptcy, outstanding student loans, etc. only when it’s time to buy a house or purchase a car. Living with that money secret leads to money stress. That’s even more true when hiding the truth about money in a relationship ignites money fights.
  4. Feeling better: Part of what causes stress is feeling incapable of dealing with the issues at hand. It’s not uncommon for someone to think “I’m bad with money,” or even, “I’m stupid with money.” However, part of the methodology behind Money Habitudes is to show people not just their money challenges but also their money strengths – regardless of what money personality type (or combination) they are. For example, one of the most common insights that we see is someone with a dominant “Selfless” personality who feels stupid and incompetent when it comes to managing finances but then sees that he or she is actually making smart decisions in terms of spending and saving money. This type is not spending frivolously is may actually be saving, but tends to give to others; it may be a co-worker going through a divorce, or a brother who always needs rent money. There’s just a weak spot in understanding how and when to say “no” to others’ requests for money.