Financial stress is probably one of the most exhausting and most common feelings. Before I started paying more attention to my finances and working toward my financial goals, I was stressed about money all the time. So what are some steps to reduce financial stress?

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1. Get on a Budget

My number one recommendation to cut down on financial stress is to get on a budget. A budget enables you to tell your money where to go when you get paid, instead of the money just disappearing and you not knowing where you actually spent it. When you budget, you know exactly how much you have to spend on different things and can plan accordingly. It’s the first step in getting out of the paycheck-to-paycheck cycle.

Getting on a budget can be very difficult, especially if you have to break old spending habits. A lot of people trying to budget for one month, don’t stick to it, and then completely give up. Living on a budget can take a few months to get used to. Don’t give up if it doesn’t immediately go to plan – it takes time to change old habits!

2. Save an Emergency Fund

An emergency fund is a saving account you establish with a certain amount of money that can only be used in the event of an unexpected immediate expense. For example, a broken water heater, the car breaks down, or your dog gets sick. Wanting a new TV or going on a spontaneous trip are NOT emergencies.

Establishing an emergency fund will provide a lot of peace of mind and will relieve a lot of financial stress, especially when an emergency does happen. Something that you would have to stress and scrape the money together for in the past, can now just be handled. A good starting point for an emergency fund if you are just getting started with budgeting is around $1,000. Eventually an emergency fund with 4-6 months worth of expenses saved up is a great goal to have.

3. Track your Bill Payments

Some people are extremely type A and never miss a bill payment. However, if you just aren’t naturally that organized and have trouble remembering to pay your bills, having a tracking system for your bill payments will help you out a ton.

I use a budget planner to keep track of all my financial information, including my bill tracker. This can be as simple as a spreadsheet that lists all the months and all your bills and due dates so that you can check off when each one is paid. Here’s an example of