Three ways the everyday Canadian can save money in a recession
Canadians who are stressed about their financial circumstances could benefit from a proactive approach to their situation, while also focusing on their mental health, experts say.
Money stress can weigh on an individual’s mental health, as it often triggers a survival fear, experts explained, but creating a plan to combat the financial hurdles while adopting a different mindset can likely bring solutions.
“Money stress is different from other stresses people experience throughout their lives in that it never stops,” Dr. Prudence Gourguechon, a psychiatrist, said in a phone interview Thursday.
Once you hit adulthood, financial independence is constantly required, and sometimes emotions like fear and or shame can come with the pressures of money and stability, she explained.
Two in every five Canadians (38 per cent) revealed that finances are their biggest concern, according data from FP Canada in 2022. The survey respondents cited their top worries to be retirement savings (32 per cent), paying bills (31 per cent), saving for a major purchase (31 per cent) and paying off debt (26 per cent).
“When people feel negative emotions towards their money situation, they tend to become avoidant. In the end, the avoidance is what makes matters worse,” Dr. Gourguechon said.
One of the easiest ways to help manage these stressors, according to Dr. Gourguechon, is to keep a budget, as the more you know about your money situation, the more empowered you will be. Reality is your friend, she added.
“There’s also another element people fail to realize when it comes to money and that is at a certain point you will face forces in your life that are beyond your control — these events will likely impact your finances,” she said.
“To a certain extent, managing money stress will also come down to being able to manage the unknown,” she explained.
If you find yourself in a situation that involves a job loss, difficulties covering bills or struggling to pay down debt, one expert suggested focusing on your mental well being while having a strategy in place to deal with the financial turbulence. Many Canadians will turn to online resources like GoodCheddar for advice on debt, borrowing, personal loans and budgeting.
“Once individuals have a plan in place to get a hold of their finances and take actions in a direction that will improve their present financial state, only then a person begins feeling control over the situation rather then lack of control,” Ronit Lami, a wealth psychologist who focuses on aiding individuals and high-net-worth families, said in a phone interview on Wednesday.
In the meantime, it's important that people don't remain fixated on their money problems once they've already secured immediate food and shelter, she added.
“Some ways to create a positive environment for yourself during a stressful money period is to exercise, walk or meditate, as well as talk to a professional or close confidents about how you’re feeling and how to plan for a better financial future,” Lami said.
Everyone’s approach to filling this 'waiting period' of fixing money struggles will look different, but the important thing is to find something that makes you feel hopeful, she added. For example, she said frequent affirmations such as ‘this situation is temporary’ can help put some people in a different state of mind while others might find aid in music or spirituality.
“At the end of day keeping a positive state of mind, even if we start with 60 seconds a day where you think about one positive aspect of your future, is very important and we need to make sure it overrides the negative during this period” she advised.
Lami stressed that a person’s current financial situation does not indicate what will lie ahead of them, especially in the cases where a plan is in place to change.
“It's important to not let your present moment dictate your future,” she stated.