Financial stress is a burden. In trying times, not being able to cover expenses and debt accumulation are a very real threat to the mental and physical health of the average Canadian. If you’re feeling overwhelmed, look at the causes of financial stress. Find a way out. Whether it’s an immediate need to cover expenses or how to get out of debt you’ve been racking up for months, there’s always a way.
Let’s look at the ten most common causes of financial stress to gain a better understanding:
Cause #1: Rising Debt
One of the most common causes of financial stress is a rising debt. A lot of begin accumulating debt in very small amounts. Then, more expenses come along. Eventually, we wake up and realize there’s no way to pay it off. The interest and overall debt continues to rise, eventually leading some to declare bankruptcy.
Ideally, this is something we don’t want to happen. If your debt is at an uncontrollable level, speak with your bank or a payday loan service provider to borrow money int he short term. Consider where you can borrow money to pay off a portion of this debt quickly. There are ways forward.
Cause #2: Job-Related
Losing a job, working reduced hours, or having your company close up operations are a major disruption. They can put any household under extreme financial stress because this affects your income. It’s difficult to predict when the situation will change. If this is you, it’s important to do whatever you can to survive and cover your expenses momentarily. If you’re unhappy, professionally speaking, make a change.
Cause #3: Education-Related
A lot of Canadians do not have a formal education. They are in their positions either through experience, a high level of expertise, or sheer willpower in excelling at what they do. Later in life, getting an education in a new professional role is a big expense.
Losing your job and with no education or resources to find a job in a new sector, this is also a problem. Our society is demanding. Canada wants educated workers. A lack of education can be an understandable source of financial stress.
Cause #4: Medical-Related
At some point in our lives, each and every one of us is going to get sick and incur the financial stresses that come with that. For some, it’s being unable to work. For others, it’s affording medications or uncovered treatments for a specific condition. Seeing a dentist, for example, is uncovered.
Medical expenses are unavoidable and it’s important to remember that. Don’t discourage. There are ways to cover the cost, such as with an easy-to-qualify-for payday loan.
Cause #5: Marital/Family Issues
Our personal lives have a huge effect on our ability to earn income. In Canada, roughly 40 percent of marriages end in divorce. A major reason why is financial issues. When there’s money issues being hidden, someone spending unnecessarily, or when there isn’t a realistic budget enacted, a marriage then has two people working towards separate financial goals.
This is a recipe for disaster. Communication is key in any relationship, especially when it comes to marriage. Ensure you’re open and honest, as you would expect from the other person.
Cause #6: Home Expenses
We look at real estate as a saving grace. It’s a stable investment. We pay off our mortgage and we have a huge asset left. A home comes with expenses though. Major repairs such as a basement flooring, roofing repairs, electrical work, or heating can be very expensive. If you’re a homeowner, ensure you’re setting aside a little every month to cover any of these unexpected expenses.
Cause #7: Lack of Savings
In the early 1980s, the average household was putting 18% of their income towards savings. Unfortunately, today the savings rate has gone down to 2%. Most don’t have anything to save. Long-term, this isn’t good. Should there be an emergency, you won’t have the cushion to adequately cover it. The way to change this is by re-budgeting. Cut down on expenses. Look at way to increase your income.
Cause #8: No Progress
For some Canadians, they feel they’re doing everything right. They’re budgeting and they’re watching what they spend. For them though, things either aren’t moving or aren’t moving fast enough. When you are making the effort and aren’t seeing the progress you want, something’s wrong. Don’t get stressed. Look at what’s happening. Try to identify opportunities to either cut expenses or increase your income.
Cause #9: Unnecessary Expenditures
Look at any of our monthly budgets. Analyzing the way we spend money, you’ll find things we spend money on that aren’t essentials. Fast food, Starbucks or Tim Hortons, beauty products, clothes, movies, books, apps, cable TV, and more. Common unnecessary purchases can be eating up your budget. If you aren’t monitoring your spending, very quickly you can end up spending more than you actually need or want to.
Cause #10: You’re Getting Closer to Retirement
A lot of older Canadians are getting closer to retirement. They’re calculating their expenses, including rent or mortgage payments, utilities, food, medications, and other essentials, and are seeing a disappointing reality. If you can’t afford to live within your means in retirement, downgrading to a more affordable living situation is recommended. Another alternative is considering a part-time job somewhere that allows you to earn a little extra while you enjoy retirement.