How to set Financial Goals and reduce money worries

Many Australians are finding themselves buckling under the weight of financial concerns. Pressure from rising living costs to economic uncertainty can take a toll on overall well-being. 

In this article, we look at how setting financial goals, whether big or small, can reduce financial anxiety by increasing feelings of control and positively impacting all aspects of your life. 

1 in 3 Aussies say money pressures are impacting mental health

The Australian Psychological Society recently highlighted that economic concerns significantly impact individuals’ psychological well-being, increasing stress levels and decreasing overall satisfaction with life. From mounting bills to the struggle of making ends meet, many Australians find themselves in a constant battle against financial anxiety.

This is backed up by Beyond Blue, which found that one-third of survey respondents said cost-of-living pressures had negatively impacted their mental health either “quite a bit” or “an extreme amount” over the previous 12 months. 

Research from the Australian Securities and Investment Commission (ASIC) found that people experiencing financial challenges are at least twice as likely to encounter mental health issues than those who aren’t.

While it’s important to seek professional help for mental health issues, there are also steps you can take to help alleviate financial anxiety, and it starts with setting financial goals.

Goal setting is more than just a motivational tool

It’s rooted in psychological principles that drive human behaviour. When we set clear, attainable goals, it triggers cognitive processes aimed at achieving those objectives. Goal setting provides direction, enhances focus, and instils a sense of purpose. By breaking down daunting financial challenges into manageable milestones, you can navigate your way towards financial stability with greater confidence and resilience.

A roadmap for action increases feelings of control

One common objection to setting financial goals is the fear of adding another burden to an already overwhelmed plate. While it may seem counterintuitive, setting specific financial goals can actually alleviate stress by providing a roadmap for action. Rather than being weighed down by vague worries and uncertainties, goal setting gives you a sense of control and empowerment. 

Financial goals you can set

• Setting a budget so you aren’t spending more than you earn.
• Clearing debt so you can reduce the interest you’re paying.
• Building an emergency fund to cope with unexpected expenses. 
• Saving up for a new car or big holiday.
• Setting up your finances so you can start a family.
• Planning for the future so you can retire when you want to.
• Saving a deposit for a home or investment property.

Ways to take action

It can feel overwhelming to take the first step, but there is plenty of help and resources available.

• Start by assessing your current financial situation and identifying areas of improvement. You can do this for FREE at moneyGPS. Their Money Check-Up report gives you an analysis of where you are at, the goals you want to achieve and a roadmap on how to get there. Plus, you get a complimentary call with a qualified GPS Coach who can talk you through the next steps. All for $0.
• Get trusted information and resources online from your financial adviser’s or Accountant’s Money Hub, or trustworthy Government resources such as Money Smart.
• Contact a financial counsellor. The National Debt Helpline is a not-for-profit service that helps people tackle their debt problems.

While financial worries may seem overwhelming, setting clear and actionable goals offers a path towards becoming more financially stable and secure. It can help you reduce financial anxiety and look forward to a brighter financial future.

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