How can young people get rid of "money pressure"?

Money is often the biggest cause of stress in people.

As the saying goes, rich people are not necessarily happy, and happy people are not necessarily rich. A different "money view" will bring about a completely different state of life. Having the right understanding of money can not only make us more financially free, but also make our lives happier.

According to the American Psychological Association, money is the biggest cause of stress in the United States. Medical statistics show that 75% to 90% of doctor visits are for stress-related illnesses and discomforts, including chest pain, headaches, high blood pressure, insomnia and depression.

Money stress can make people physically and mentally uncomfortable, and we have two options for this:

1. Complaining, resisting, worrying

2. Fix the problem

 

I will choose the latter. We cannot fundamentally change capitalism, but we do not have to be its victims. We can understand how money works and be immune to the mental health problems it brings.

Change starts with awareness. It can only be solved when we know exactly what causes money stress.

What causes economic stress and how we can address them

Most people think the answer is: make more money.

But simply having more income won't solve your money problems. While everyone wants to earn more, we need to address some deeper underlying issues first.

The first step in escaping financial stress and living a healthier, happier life is to identify the specific cause of your concern. Here are some common causes and how to fix them.

1. Lack of financial literacy

So-called "financial management" is not something we usually learn in school. If a person grows up in an environment that lacks the concept of financial management, it can be difficult as an adult to make informed financial decisions.

I didn't really use a savings account until I was in my late twenties. Until then, I keep all my cash in a savings account and spend it as I want.

School didn't teach me how to manage money. It took me a long time to understand this. This meant that I wasted a lot of time before I learned how to do things right.

Solution: Learn about personal finance.

How you spend, save, indebted and invest is up to you. How other people manage their money has nothing to do with you. Can your ex-college friends afford an exotic trip, but you can't even pay the rent? Who cares about this except you.

Everyone is at a different stage of their personal finance journey. It is important that the advice you take should be the most relevant and effective for you.

The more you know about money, investments, and wealth, the better at managing your finances.

2. Unrealistic expectations about life

Many of us have all kinds of unrealistic wishes. It's okay to have big dreams, but you should never think that life is good only when you achieve big dreams. We might think like this:

"At this stage of my life, I should have a house/car/overseas trip!"

"I'm so old now and should be making at least six figures."

It's easy to feel stressed when we don't meet expectations. In today's world, everyone seems to have extremely high expectations.

This is unrealistic and unimportant. What's wrong with living a simple life?

The Solution: Focus on the Process, Not the Results

When you're setting goals, it's easy to think about the outcome first. Everyone wants to get in better shape, travel to great places, make more money, etc.

But these results are driven by long-term, ongoing work. Warren Buffett didn't get rich by making one big deal in one year, but it took decades of tireless work to get to where he is now.

So, what you have to do is focus on a process that can be sustained and the results will follow. If not, at least you can be proud of the work you do.

3. Short-term thinking

I have a friend who has been doing a job he hates because of the so-called "welfare" because he places a high value on stability and the welfare in his company is not good. But at the same time, he also "passes the time" by shopping online at work, so naturally he got into credit card debt.

A lot of us are in a situation where we hate our job but need such a job or income to live on because we are used to a certain way of life.

But sometimes, you need to take a step back in the short term to achieve long-term growth. Why? Because if you keep this short-sighted thinking, you will end up wasting your own life.

Solution: Focus on long-term quality of life.

For me, quality of life is the most important measure. Do you really enjoy your life? Do you like your job? Do you wake up feeling excited?

Focus on these metrics, not job title or salary. "Avoid money stress by not prioritizing money" may sound counterintuitive, but that's not the point. You have to consider your quality of life. As we all know, the best things in life are free. But mortgages and rents are not. But there's nothing wrong with choosing to earn relatively less in order to live better.

4. No emergency fund

56% of Americans don't have a one-time emergency expense of $1,000.

However, emergencies are bound to happen. It's not a question of if, but when. For example, your washing machine breaks, you slip and hurt, your loved one is sick, etc.

It's hard to be at peace when you don't have enough money for simple emergencies. Without the protection of a safety net, one adverse situation can turn your entire life upside down.

The fix: Build your own emergency fund bit by bit and make saving a habit.

An emergency fund is not something that can be created suddenly, you can try to save a portion of your income every month, and as long as you stick with it, it will happen sooner or later. I want to have at least six months of living expenses in my emergency fund. Knowing that I had this money in my savings account gave me peace of mind. Because I know I can handle the financial challenges of my life, and if something happens, I have plenty of time to get back on my feet.

One thing I've discovered over the years is that the urge to make more money never completely goes away.

That's why we remind ourselves that making more money is not a good goal. Our goal should be freedom:

Money can buy many things, but the most precious of them is freedom. Freedom to do what you want and work for people you respect.

When I see a job that pays more but drastically reduces freedom, I don't apply. Because my priority is to live a simple and balanced life.

Isn't that exactly what we want in the end?

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Your Money Matters: A Comprehensive Guide to Financial Planning