This post may contain affiliate links, allowing us to earn a commission on the products we would recommend to our families and closest friends. You can find more info on our Legal Stuff page.
Good money management inevitably involves all sorts of different practises, and potential mindset shifts.
In order to be as financially savvy and responsible as you can, for example, you will certainly need to develop a level of comfort with effective budgeting.
It will also be important to get a sense of the kinds of things that might cause you to make impulsive purchases, and to begin consistently spending in a more moderate and considered way.
Out of all the different things that can potentially undermine good money management, however, simple chronic stress is perhaps one of the most substantial – and it’s something that huge numbers of people end up experiencing on a day-to-day basis, often without even necessarily being aware of it.
Life often generates stressful situations which can cause people to feel desperate and to seek out any number of different fixes for the major problems they may be facing. Those fixes could include things like an affordable short term installment loan, or selling personal belongings.
Whatever the potential causes of stress in your life, and whatever the potential solutions might be, being chronically stressed can have an extremely detrimental impact on everything from your health to your financial life.
Here are some ways that unmanaged stress leads to poor financial management.
By severely undermining willpower
Chronic stress – much like chronic sleep deprivation – ends up significantly impairing and undermining willpower.
When we are chronically stressed, we move more into “fight and flight mode,” where we are naturally inclined to make quick decisions, and to be more reactive to our environments, as opposed to proactive.
Willpower, on the other hand, means that the more conscious, calm, and collected part of yourself is calling the shots to a greater degree, and can resist some of those impulses and knee-jerk reactions more effectively.
Willpower, of course, is always going to play a significant role in good money management, both in order to keep you current with your budget even when you don’t feel like updating it, and also with regards to keeping your spending habits in line, when you might feel like doing something else.
By making it much harder to focus
A major part of good money management is focus, and the ability to pay attention to the right thing, for a prolonged period of time.
Chronic stress is well known to undermine focus, and some writers have even suggested that stress may be at the heart of the current ADHD epidemic.
By increasing impulsivity
One related consequence of the fact that chronic stress undermines willpower, is that chronic stress also increases impulsivity.
As various psychologists have commented, being in a state of chronic stress seems to give some part of the psyche the sense that resources are scarce, and so it’s important to get whatever you can, immediately.
In the context of good money management, this obviously doesn’t work – as it means that you will be significantly more inclined to purchase things that you find alluring here and now, but that you don’t need, and that you haven’t accounted for in your budget.
Impulsive spending habits are one of the key obstacles to good money management in general, and if you spend all your money as soon as you get it, it’s impossible to commit to long-term and more rewarding financial plans.
Comments (0)