How to feel better about your finances

4th October 2018

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In the run up to the World Health Organisation's World Mental Health Day on October 10th, we've asked Laura Whateley, financial journalist with The Times and author of Money: A User’s Guide, to share her advice on what we can all do to feel better about managing our money.


The jury’s out on whether money can buy you happiness but there is no doubt that not having the sense you are in control of it or believing, whatever your income, that you are not earning enough of it can have a negative impact on your wellbeing.

Maybe you can’t afford a comfortable place to live, can’t scrape together enough to pay off your credit cards or gambling debts. Maybe you don’t seem valued enough for a pay rise at work or you simply consider yourself worse off compared with your peers - unable to afford the lifestyle that they lead or the restaurants that they book. Or, perhaps you are struggling with a mental health condition such as bipolar that has symptoms of manic overspending, or depression and anxiety that make you unable to open a letter from your bank or make a phone call to your energy company - both are extremely common.

A quarter of people will experience a mental health issue this year but we are all liable to let money, and the emotions surrounding it, get on top of us. Money and unhappiness can form a vicious circle as those with serious mental health conditions may be unable to carry on earning as normal when in the depths of a crisis. According to Mind, the mental health charity, people with a mental health problem are three times as likely to be in debt than those without.

Those who are struggling with their finances, or the way that money makes them feel, are more likely to fall prey to mental health problems as a consequence. People in unmanageable debt are 33 per cent more prone than those not in debt to develop depression and anxiety, Mind’s research shows. But there are some practical steps you can take to help you feel better.

Monitor your spending

Keeping a money diary can help you see clearly when it is you lose motivation to keep control of your finances, or when you might spend more money than normal to make yourself feel better. “It could be that talking to people about money makes you feel really stressed, or you feel very anxious when you know bills are about to leave your account,” says Paul Spencer, policy manager of Mind. “Recognising patterns might help you prepare for a stressful time that’s coming up.”

With Starling, customers receive a notification to their phone when money comes in or out of their account or when a bill is coming up. Customers can also see a monthly breakdown of their spend by merchant and automatic calculations of how much they’ve spent on travel or shopping, helping them to understand their spending habits month to month.

Starling Bank app in phones with screens of notifications, options to block gambling payments and categories.

Take back control

Setting a budget can help you wrestle some control of where your money is going and why and see clearly which bills you owe and when. Set yourself a regular time maybe once a week or month to force yourself to look at bills and your bank balance so things don’t get out of hand and feel more difficult to tackle.

Try transferring money out of the account where your salary is paid into separate savings spaces to ring fence what you need for rent or bills. Apps and banks such as Starling enable you to do this really quickly and easily on your phone. With Starling, money you want to save can be kept separate from your everyday balance but can be easily moved back or topped up if and when you want to.

Think about your relationship with money

Try to unpick not only the mistakes you are making but why you might be making them, where any fears about money may stem from, and whether those fears are grounded in reality.

Confide in someone

We hate talking about money and fear judgement by revealing that we are having difficulty managing it, but everyone finds the topic stressful at some stage of their life. Almost a third of us have felt stressed when talking about money at some point, according to research from Starling Bank.

Confiding in a trusted friend or relative can help you manage your money if it is affecting your mental health. Tell them about your worries and any triggers or warning signs, for example if you have bipolar disorder and you spend too much at certain times, so they can know to help if they notice you acting differently about money.

Seek professional advice

If you’d prefer, you can talk to an expert anonymously. The Money Advice Service or Citizens Advice offer free face to face meetings to discuss how to manage your money. Mental Health and Money Advice has lots of practical steps.

Get help with debts

If debt is your concern, seek help as soon as possible, it can save you much more money in the long run. The charity StepChange found half of its clients waited a year to get advice, but in just six months someone with a typical range of debts and arrears could pay an additional £2,300 in interest and charges.

StepChange has a free, anonymous online debt-remedy tool, which offers a budget and advice tailored to your situation.

There are also debt-management plans available, where a company will take over your debts and write to creditors for you and you make one central payment to the management company a month. Beware those that charge, they can be expensive, StepChange and PayPlan offer them free.

Talk to your bank

If you tend to overspend, speak to your bank about whether you can set a spending limit or block on your card. You may want to freeze your debit card for a period or choose to self-exclude from gambling sites, features that the charity Money and Mental Health has recommended that banks offer to their customers. Starling customers can block transactions made at gambling and betting institutions by toggling the gambling blocker in the card control section of their app. They can also block (and unblock) ATM withdrawals and online payments with a simple tap.

Be kind to yourself

Don’t write yourself off as ‘terrible with money.’ It’s not unusual to feel that you’re no good at handling your money. Almost half of UK adults say their knowledge of financial matters is low, according to the FCA (Financial Conduct Authority).

Realising that lots of people also find it difficult to save, easy to spend and think of themselves as ‘terrible with money’ can help us all feel that we’re not the only ones. And that these labels that we give ourselves don’t have to last or hold us back when it comes to taking some time to look at our finances and make small changes that can have a big impact.

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