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Stress Management - Chapter 12
Transcript of Stress Management - Chapter 12
Money Matters - Explain the ABCs of money management
- Create and implement a plan for financial fitness
-Set financial goals to reduce money-related stress
-Discuss how doodads and credit cards contribute to financial stress
- Investigate what the research says about the relationship between money and satisfaction in life Money Matters Money is the leading stress for Americans
More than 3 out of every 4 American families are in debt Objectives National study surveyed 1000 people ages 18 and older Financial Worries Top List; Young People Most Stressed Research Highlight Results:
47% feel more stressed than they did 6 months ago
49% reported personal financial concerns as their number one stressor Financial Worries Top List; Young People Most Stressed Research Highlight Source: “American’s Stress Levels Rising - Financial Worries Top Stressor List” by M. Moyad, retrieved April 30, 2011 from http://healthnewsdigest.com/news/Guest_Columnist_710/American_s_Stress_Levels_Rising_Financial_Worries_Top_Stressor_List.shtml Younger people felt more stressed than older people
As stress coping strategies, More respondents cited “meditation and breathing techniques” than “taking a vacation” Financial Worries Top List; Young People Most Stressed Research Highlight ABCs of Money Management Assessment
Look at where you are now and evaluate how you got there
Begin by becoming more aware of your spending habits Exercise 1 – Current Spending Habits
For one week, keep track of your spending habits Thoughts, Emotions, and Money Assessment also entails figuring out why we spend money
Be careful not to let money become a substitute for emotional needs
How does this money-emotion connection relate to you? Exercise 2 – Money and Emotions As you track your spending, analyze the thoughts and emotions associated to you spending Budget A plan you develop to manage your money so you can have what is most important to you and accomplish your financial goals Exercise 3 – Financial Goals SMART Goals
S – Specific
M – Measurable
A – Action-oriented
R – Realistic
T – Time-based Look back at Exercise 1
Take a red pen and cross out all unnecessary expenditures that did not contribute to your financial goals Exercise 4 – Income and Expenditures Calculate what you expect your income to be over the academic year
Determine your expenses for the year
What does this tell you about your balance of income and expenditures? Exercise 5 – Develop Your Budget Get your records of expenditures
Make a column for each category of spending
List each purchase as best you can under the proper column
Total each column Add the column totals together
Compare this amount with your income
Make adjustments when necessary Track what you spend on wants versus what you spend on needs Time Tip Control Fixed expense versus flexible expenses
The key to financial success is consciously deciding how you will manage your money Doodads and Credit Cards Doodads
Expenses, often unnecessary or unexpected, that take money out of your pocket Latte factor - spending money on little things that you could cut back on without changing your lifestyle Exercise 6 – Doodads Do Add Up Think of one doodad that is part of your routine
Determine the cost
Calculate what you would save in a month if you were to eliminate that doodad Strategies for Saving Eliminate a doodad and deposit the money into savings
Pay yourself first
Put all your loose change in a big jar and deposit it into savings when the jar is full
Put your tax refund into a savings account
Save one hour a day of your income Credit cards can be an especially subtle way to accumulate debt
Spend 20% less by switching to cash-only payments Tips for Managing Credit -Use credit cards only for emergencies or carefully pre-planned purchases
- Pay the full balance each month
- Limit to one credit card
- Remember that credit is debt
- Put your tax refund into a savings account
- Save one hour a day of your income
- Pay more than the minimum balance
- Get a lower interest rate
- Learn to defer gratification
- Wrap your credit card
- Limit your personal credit card allowance
- Be aware of student credit card deals
- Use a debit card (be aware of monthly transaction limit) Credit Cards Exercise 7 – Pros and Cons of Credit Cards Make a list of the pros and cons of having a credit card
Carefully review your list and decide if a credit card is valuable to you
If it is, what conditions would help you control your use of credit?
What else can you do to manage your money wisely? Can Money Make You Happy? The source of much stress is not the value we give to money
We need to manage our mind as well as our money
People are just as happy today as they were in 1950 Affluenza The disease-like epidemic that is causing our society to have more and more material possessions and to spend money we don’t have, resulting in growing debt
“The more you have, the more you have to worry about” – Leo Buscaglia Reference Anxiety Judging your possessions in comparison with others, not based on what you need
We can be financially wealthy but emotionally bankrupt Money and Relationships Respondents in one survey said that managing their finances is the biggest strain on their relationships
We determine the value we give to money and, as a result, either the satisfaction or distress it produces Putting It All Together – What the Experts Say What is the most important financial principle?
“Contentment. That’s right, contentment. Contentment brings peace.”
– Dave Ramsey
Money is neither good nor bad
It is simply a tool For one week, track your spending
Day, date and time
What you purchased
Want or need?
Emotions associated with purchase Spending Habits LAB Analyze your spending
Do you notice any patterns?
What do you notice about your emotions?
Do you regret making any purchases? Spending Habits LAB Do your spending habits contribute to your stress? If so, how and what changes can you make?
What are two insights you have gained? Spending Habits LAB Plan for the future
Use the SMART format to write two personal financial goals Spending Habits LAB Key Points Financial pressure ranks high on the list of stressors facing college students
Practicing the ABCs of money management can put you in charge of your money A budget is a plan to manage your money so you can have what is most important to you and accomplish your financial goals
Financial goals can guide you in getting what you want financially Key Points Money allows us to pay for the things we need and also can be used to address emotional needs
The latte factor is a metaphor for spending money on little things that you could cut back on without changing your lifestyle Key Points Two areas of financial management that deserve extra attention are doodads and credit cards
Saving even a small amount of money regularly can contribute to financial freedom Key Points The source of much stress is not just money itself but the value we give money
Money does not necessarily equate to happiness but a lack of money to meet basic needs can contribute to the stress of poverty Key Points