Navigating financial anxiety

Steps you can take to navigate your way back to better financial health.

  • Talk to someone and access help that is available
  • Understand your money situation
  • Look to make small and manageable changes
  • Deal with your debt
  • Revisit your budget.


Cost of living pressures are leading causes of financial anxiety for many Australians. Worrying about money can take its toll on your mental health. The Black Dog Institute, says, “The link between mental and financial health can be a vicious cycle: financial stress can lead to poor mental health, which can make taking action to protect your financial health harder. People may engage in unhealthy behaviours to try to cope with financial stress, from avoidance, to overeating and alcohol and drug misuse, which in turn can worsen mental health. Ongoing stress about money has been linked to physical ill health too, such as migraines, heart disease and sleep problems.”


During challenging times, small steps can help you feel more in control of your financial future.  So, we’ll share some simple, practical actions you can take towards better financial health, and guidance on where to turn for help to get your finances back on track.

Steps to consider to navigate your way back to better financial health

Step 1: Talk to someone

Many of us may feel awkward about sharing money matters with others or even feel a sense of shame about our finances. However, bottling things up may only make financial stress worse. Talking over your worries may help you come up with solutions that you hadn’t thought of alone.


Fortunately, there are skilled professionals, like financial counsellors, who help people understand which debts are priorities, develop budgets and money plans and understand the pros and cons of different options to manage financial issues.


Even if you prefer being self-sufficient, consider keeping your family up to date, if safe to do so, on your financial situation and see how they may be able to support you.

Step 2: Understand your money situation

To better understand your money situation, record all your income and expenses in one place so you can see how much you're spending, and what you're spending it on.


When considering your money situation remember to:

  • Include all sources of income. In addition to your salary, include bonuses, benefits, support payments, or any interest or dividends from shares you receive
  • Keep track of all your spending. Seemingly small expenses, like buying a coffee each day, can mount up over time, so keep track of all your spending. Understanding how you spend your money is important when making a plan to address your financial needs
  • List all your debts. Include overdue bills, Buy Now Pay Later debts, late fees, and list minimum payments due, as well as any money you may owe to family or friends.

Step 3: Try to make small and manageable changes

Spending money on things like multiple streaming subscriptions, a lunchtime sandwich, or a bottle of water can add up to a significant monthly expense. Finding little ways to reduce your daily expenditure may help free up extra cash to repay debts and set you on a path to achieving your financial goals.


Are you ever tempted to splurge, or impulse spend? Have you ever seen something online that you just had to buy? Impulsive buying can wreck your budget and cause more financial stress. Consider these tips to help stop impulse buying:

  • Make a budget and stick to it
  • Defer spending and take a purchasing pause. With a fresh set of eyes, you might decide you don’t need to buy that ‘must-have’ item
  • Be careful about joining email-marketing lists which may bombard your inbox with sales pitches. Check the emails you currently receive and try unsubscribing from those that don’t offer you value.

Step 4: Deal with your debt

The sooner you get started on dealing with your debts the more you’ll feel in control. Try to list your debts, the amounts you owe, the interest rates and repayments. Then number these loans in priority order, from highest to lowest interest rate. 


Some tips to keep your debts in check:

  • If you’re struggling to make repayments, get ahead by speaking to your bank or the people you owe money to. They may be able to help you find a better way to manage the repayments
  • Consider whether consolidating your debts might help your circumstances. And if you’re able to, move your debts from higher interest rates to a lower rate. This may help make your repayments more manageable
  • Set a realistic date for when you wish to be debt-free. Use this as a goal you can work towards, calculating when you can pay off what you owe
  • If you do have savings, you may consider using them to help repay your debts. The interest rate you pay on your loans may be more than the interest you receive on your savings. But don’t run yourself short of available cash for emergencies.

Step 5: Revisit your budget

A good budget helps you to take control of your money, save, organise debt repayments, and make the decisions that could change your finances for the better.


Check the following items off your to-do list to plan effectively, budget and remain in control.

  • Record: Try recording when you receive your pay, when bills are due and when automatic payments are due. This can help you find times when your cashflow could be low during the month. Also consider writing down everything you spend in a day. Then try it for a week, and then for a month. It might be surprising how quickly little things add up
  • Review: Check your bills, and make sure your figures are accurate by ensuring your receipts and bills align with your budget. Of course, some things may fluctuate from month to month due to emergencies and other unpredicted events
  • Reduce: Try to ensure that your expenses are less than your income
  • Renegotiate: Look at your large expenses, like your utility bills, and ask yourself can you renegotiate or ask your provider for a better deal?
  • Repay: Create a plan to pay off debt, so you know when your credit card balances, student loans, car or personal loan payments are going to be paid off. A key point to debt reduction is to try repaying your debt with the highest interest and fees first
  • Revisit: Regularly check your spending against your budget  to make sure you are sticking to your plan.

Help is available

Other support services are available:

Free Financial Counselling is available from the National Debt Helpline

Westpac has resources and tools to help people get back on their feet