Top causes of financial stress and what to do about them

There are lots of things that can stress us out these days. From our jobs and the responsibilities that we have to deal with to health issues or traumatic events, stress triggers are everywhere around us. Most of us experience stress on a daily basis and we’ve come to get used to it. After all, the only way to avoid stress altogether is to live in complete isolation, which is probably not a great alternative either. 

A little stress never killed anybody, but a lot of it can have a serious impact on your mental and physical health. That’s why it’s important to identify the root cause of stress and learn how to manage it before it becomes a major issue and stops you from living the life you imagined. Probably one of the biggest sources of stress right now is represented by financial stress. But knowing that is not enough to solve the problem. We have to dig a bit deeper and find out what causes financial stress in the first place.

So, let’s take a look at some of the most common causes of financial stress to gain a better understanding of the problem. 


Debt is the number one cause of financial stress on our list because it’s an issue that many people deal with at the moment. You start by taking out a small loan, then you borrow more money, until one day you come to realize that you’ve accumulated too much debt and now you can’t afford to pay the money back. That’s the recipe for falling into debt and living with financial stress while struggling to get out of it. 

One way to avoid this scenario is by making sure you don’t take more money than you can handle, whether we’re talking personal loans, Alpine credits home equity loans or any other type of loan. Most debts are created by borrowing small amounts of money over time, giving you the false impression that you’re on top of your finances. If you’ve reached this point, taking out a debt consolidation loan or consulting with a financial adviser can help you get back on track.       

Monthly expenses

For most of us, having a house, a car, or other assets is a true blessing, but all these things come also come with costs. There are aspects like maintenance and repairs to take into consideration, and sometimes paying monthly bills can become a financial burden. If you’re not that great at budgeting or you don’t know how to handle your expenses properly, then it’s rather easy to get into financial trouble. 

Luckily, you can educate yourself to become more financially literate and stay on top of your monthly expenses. Creating a monthly budget and sticking to it, making sure you don’t spend more than you earn, and avoiding buying items that you can’t afford or that you don’t need should help in this respect. 

Education expenses 

School can be tough, not only because you have to study hard to achieve your educational goals, but also because it can place a great financial burden on your shoulders. A lot of young people give up on completing their studies because they can’t afford to pay the tuition fees. And many of those who decide to continue their studies have to make a big financial effort to cover all the expenses. 

Creating a savings account, securing a scholarship, or getting a part-time job that allows you to study and work at the same time can help you fund your education and experience less financial stress as a result.  

Not having an emergency fund 

You might earn a nice income that allows you to live a comfortable life, but can you handle extra expenses if something unexpected were to happen? Many people are not financially prepared to deal with these issues, leaving them in a very vulnerable situation. Some have very low reserve funds, while others have no savings at all, so if an unforeseen event happens, it can spell disaster for them. 

The wisest thing to do is to create an emergency fund when you are financially stable. You can do that by monitoring your budget, making smart investments, limiting your spending, and putting money aside every month. 

Not having a stable income

These days it’s pretty common for people to work more than one job or have a side gig to supplement their income. This gives the impression that we have more options than ever to earn money and create the lifestyle that we envision, but things are not that simple. 

Not everyone is lucky enough to have a stable job that can ensure financial security. Unemployment rates are quite high in many parts of the world. Add the risk of losing your job, or not working enough hours to that and you can easily understand how financial stress makes an appearance. It’s important to focus on your education and choose a suitable career so you can earn a stable income even in times of crisis. 

Inability to retire 

For some, getting close to retirement age is bliss, while for others it’s a complete nightmare. That’s because they weren’t cautious enough to plan for retirement in their youth and now, they can’t take this step because their retirement income wouldn’t be enough to support the lifestyle they’re used to. The lesson here is to avoid getting to this point while you still can. Plan for retirement when you’re young and healthy, so you’ll have enough money to live comfortably when you’re older. 

Not making any progress 

Anyone can experience financial stress, even those who are financially literate and make wise money decisions. That’s because they may be doing everything right, but they’re not seeing any progress in their financial situation. If you want to advance financially and improve your standard of living, apart from avoiding common financial mistakes, you should also search for growth opportunities wherever you can. That will help you increase your income over time and keep financial stress at bay.

As you can see, financial stress can happen for any number of reasons, but if you take the time to educate yourself on money matters, you can significantly reduce its impact on your life. 


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