With so many Americans struggling to stay in the black, it’s easy to get the blues. From aching necks to churning stomachs, Americans are worrying themselves sick. But just as gathering thunderclouds can be a godsend to a thirsty desert, the rising economic storm provides fertile ground for change. Here are three ways to turn your economic storm into welcome rain.
Reading the clouds
When it comes to Americans’ health, two main economic factors weigh heavily: mounting personal debt and unrelenting news about the nation’s economic “crisis.” According to a recent survey, 8 out of 10 respondents cited money and the economy as the primary sources of stress in their lives — replacing work and relationships.1 What’s more, the physical impact of stress is rising: reports of stress-induced ailments have spiked, nearly tripling over the past year.2
In a recent poll, nearly half of respondents — at all income levels and sectors — said they were worried about losing their jobs.3 Even financially secure households are feeling the pressure of job-loss anxiety.
Americans’ personal debt levels are at record highs. Fueled by decades of easy credit and “keeping up with the Joneses” consumerism, debt that started as a ripple now feels like a tsunami. On average, American households pay around 20% of their monthly income toward non-mortgage debt — and many are barely keeping up.
It can feel like the economic “storm of the century” is gathering. But you can weather the downturn, and even find new ground.
Step 1: Turn deprivation into celebration.
With wages falling or holding steady and economic pressures closing in, many Americans are feeling the pinch when it comes to their disposable income.4 That means that each expenditure — like that Starbucks coffee — becomes a painfully larger part of the family budget.
The result for many: no more Starbucks.
While such cutbacks may feel like a loss, many find that it’s freeing to pare back. Attitudes about what is “enough” are changing. According to a recent study, nearly half of all consumers, 47%, say they already have what they need, up from 34% from November 2006.5
This shift is an important one. Identifying the difference between a “want” and a “need” is one of the first steps toward financial independence and stability. And it has an impact on stress levels, too — by clearly identifying your true needs, you’re more empowered to meet them. Such empowerment has been shown to be a pivotal factor in reducing financial stress and anxiety. |
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Step 2: Simplify.
For decades, America’s national pastime hasn’t been baseball; it’s been shopping. We have become professional over-consumers: from our waistlines to our bottom lines, we’re spreading. And with that spread come health issues and stress. In 2009, land dedicated to self storage facilities covers an area roughly the size of San Francisco and the island of Manhattan — combined.
Churches and community organizations all over the country are challenging their members to simplify — often to just “100 things.” There’s even a Facebook group dedicated to paring down to your 100 things. The result: Charitable donations are up, and people are reevaluating, de-cluttering and lightening their debt load. They’re also evaluating who they are instead of what they have.
Another way to simplify: Pay as you go with cold hard cash. Statistically, people spend less when they physically pay with cash. |
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Step 3: Grab an umbrella.
Experience is one of the best teachers around. The economic crisis caught much of the nation off guard, arriving like a full-blown hurricane. The nation’s lack of financial preparedness was exposed — along with many of the other weaknesses in our personal money matters.
Much is being done to repair the damage and reinforce foundations against future storms. The national savings rate, which has been in negative territory for years, is at a 15-year high as people pad their “rainy day” funds. For many, frugality and restrained spending have become the “new normal” — by choice.
A survey released this month shows that many Americans are turning optimistic about being able to financially right themselves — because of the lessons they’ve learned through this downturn.6 Taking control and becoming empowered — through a change in attitude, simplifying and planning for the future — have a positive impact on stress and its effects on the body. And those lessons also provide a strong foundation to weather future storms, come what may.
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12008 Stress in America Survey, American Psychological Association, 2008.
2Associated Press — AOL Poll, 2009.
3Associated Press — GfK Poll, Feb. 11, 2009.
4Bureau of Economic Analysis, April 2009.
52009 MetLife Study of the American Dream, 2009.
6Associated Press — GfK Poll, July 2009.