Dear Readers,

Even in the best of times, money concerns can cause a lot of stress. But according to a recent survey by the National Foundation for Financial Education®, nearly 9 in 10 Americans say that COVID-19 is making money a primary cause of anxiety. Add to that the need to juggle working from home, child care, home schooling and health concerns and people are being stretched to the limit.

Understandably, people are worried about their financial future. Equally understandably, they often don't feel like they have the energy to deal with it. But as overwhelming as it can seem, there are strategies to help you cope and stay calm. As I wrote recently, you may have to think differently to get through these times, but there are ways to do it. And it starts with awareness.

Be aware of what you can control

First realize that no matter how uncertain you may feel, there are some financial things you can still control. That in itself will help ease your stress. For instance, to a certain extent, you can control your spending. That may mean you have to rethink your budget, but it's in your hands. You can also control the way you prioritize your bills. It may require you to do some negotiating, but it's possible. And you can control how much you save, even if you have to redirect some of your savings to more pressing financial needs for a while.

If you're an investor, while you can't control the markets, you can control the way you respond to market events. Trying to time the market is rarely a good strategy, and bailing out at the wrong time can be a costly mistake. So don't. Rather than overreacting to current volatility, thoughtfully rebalance based on your own goals and timeline.

Smart rebalancing means systematically selling investments that have increased in value and buying those that have decreased in value. In short, rebalancing can help you limit risk by selling high and buying low.

In all these areas, you're still in charge. Try to focus on what you can do proactively rather than reactively.

Understand how anxiety affects financial decisions

Studies have shown that anxiety has an adverse effect on almost all our financial decisions. Stress can make us spend more, save less, and rack up credit card debt. Kind of like stress eating, we think spending will make us feel better. Saving, however, can provide you with peace of mind that you can better handle unexpected expenses, adapt to changes in income or take advantage of new opportunities. The best way to feel better right now might be to put unnecessary purchases on hold and save more.

 Put everyday money management on automatic

If you haven't already, clear your mind and save time by using bill pay for regular monthly payments like mortgage, rent, utilities, phone, internet, car loans, student loans, even credit cards. All these can be paid automatically through your bank so you don't have to stress about missing a payment. (It might even qualify you for some discounts!) You just have to make sure you have the money in your checking account to cover them.

Do the same for your savings. If you have a 401(k), you're already saving for retirement automatically. You can set up regular payments from checking to savings accounts for your other savings goals.

 Share your fears

Still waking up at night with worry? Talk it out. If you have a spouse or partner, work through your financial fears—and your solutions—together. Whether it's your partner, a family member or a trusted friend, listening to another perspective may help you think more clearly. And sharing your concerns and voicing your questions can help you come up with a plan of action. Which brings me to my next point.

 Reach out to an advisor

For added peace of mind, consider talking to a financial advisor or financial planner. There's a misconception that advisors are only for the wealthy. Not so. A financial advisor can help you see beyond today's struggles and feel more confident in the future. And everyone can benefit from that.

From everyday budgeting to proper insurance to long-term goal setting for things like retirement or a child's education, a financial planner can make suggestions on how to prioritize your current needs, and outline steps you can take now toward future goals. Even a one-time consultation could offer you a helpful course of action. Plus, there's a whole range of financial advice available to fit any budget. The Foundation for Financial Planning is even working to expand pro bono counseling to vulnerable populations including low-income individuals and families, military personnel and veterans, domestic violence survivors, and people affected by disasters like COVID-19 or serious medical crises.

Rather than worry about the unknown—prepare for it

Coming up with a plan of action during uncertain times can seem counter-intuitive. How can you plan ahead if you don't know what's coming? By being flexible. Think of a plan as more of a process that will evolve over time as your goals, your life and the world around you change. It's a way to replace worry with preparation.

To me, the best way to be prepared for whatever the future holds is to follow some tried and true money management principles: spend wisely, set goals, save for emergencies, and invest for the long-term. These are the knowns you can count on to help you reach your financial goals in both good times and bad.

 Do it for your health

While we may not be consciously aware of it, money worries can be detrimental to our physical and emotional health. Conversely, it's been shown that staying on top of our money can have positive side effects. For instance, savings can act as an emotional buffer to reduce anxiety. A financial plan can give you more confidence and help you stay focused.

So just as you try to keep physically fit during this particularly difficult time, make a carefully thought out effort to keep yourself financially fit. You don't have to do everything at once, but each extra step you take to manage your money will make you feel that much better—mentally, physically and financially.

Have a personal finance question? Leave it in the comments. Carrie cannot respond to questions directly, but your topic may be considered for a future article. For Schwab account questions and general inquiries, contact Schwab.

The information provided here is for general informational purposes only and is not intended to be a substitute for specific individualized tax, legal or investment planning advice. Where specific advice is necessary or appropriate, consult with a qualified tax advisor, CPA, financial planner or investment manager. 

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