While it appears inflation is slowing down in the U.S., prices for many items and services remain high.
And those inflated prices are causing financial anxiety for consumers, with 70% of Americans reporting feeling financially stressed, according to a recent CNBC survey of more than 4,000 U.S. adults. The majority of respondents cited inflation as the main cause of their stress.
"Things are getting more expensive, and people usually have a sense of anxiety or fear surrounding inflation," says Wendell Clarke, a behavioral wealth specialist at Wealth Enhancement Group. "This can also affect things like job security, and your money's not going as far as it used to go before."
Clarke adds that these conditions tend to create "higher stress levels in people," which can show up as anxiety and depression.
If that's you, here's what Clarke and fellow behavioral wealth specialist Cohen Taylor recommend for mitigating the stress of inflation.
The No. 1 way to manage stress about finances: Expand your definition of 'wealth'
Inflation can trigger anxiety for many Americans because it may feel like a threat to their ability to achieve wealth. But wealth should be viewed as more than just money, the experts say.
Clarke and Cohen say there are six things that should be included in your definition of wealth:
- Time
- Talents
- Network
- Wisdom
- Body and mind
- Money
To determine if you're actually making the most out of each part of what makes you "wealthy" outside of money, ask yourself these questions:
- Time: Are you maximizing the use of your time? How can you use your time to help yourself through this period of financial hardship? Are you spending more time focusing on what you can change, or what's beyond your control?
- Talents: What are you good at? How can you use these talents to help you get to a better financial space? Can you turn any of your skills into a side hustle?
- Network: Are you spending time with people? Are you doing the best you can to have a support system in place? Are there any people that are increasing your anxiety around finances that you should spend less time with?
- Wisdom: What are some things that have happened in the past that you were able to get through? What did you learn from that experience? How can you use those skills to make it through this time in your life?
- Body and mind: Are you resting enough? Are you drinking enough water? Did you exercise recently? Are you eating foods that help you think clearly?
Other ways to manage your financial anxiety
Even if you're focusing on the full span of your wealth, seeing your money decrease and having to dip into your savings can still be stressful.
There are several practices you can incorporate in your life to mitigate some of that financial stress, Taylor says.
Here are a few she recommends:
- Acknowledge your feelings surrounding the economic change
- Focus on what you can control
- Be wary of the media you're consuming about inflation, and how often you're interacting with it
- Practice gratitude by being grateful for what you have
- Review your financial plan
- Live in the now
- Prioritize self care
Improving your mental health to reduce stress and anxiety should be as routine as getting an oil change for your car, says Clarke.
"Just the same way that you won't cut corners on your car," you shouldn't cut corners with your mental health, Clarke says. "What drives the car? Your body. What drives your body? Your mind."
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