Living Without the Money Stress

You don’t have to be rich to live without financial stress. It’s true!

I’ve lived most of my adult life without a big income or a ton of savings, but I’ve also largely avoided running into money problems or letting finances keep me up at night.

When I started out on my own, my goal was always to control the money we had and not let it control us. I figured spending less than I earn would be a good place to start, and I made that my one rule to never break.

Everything else I know about money I learned the hard way— trial and error with a healthy dose of common sense.

Now that I’m in my late 30s with a wife and 4 kids of my own, I can honestly say that I’m still figuring things out, and trying to get a little better each year. But I’m happy with the progress we’ve made and glad to share what’s worked for us. I hope my experiences can help some of you out there, maybe even if it’s just to show that it’s possible.

Without further distraction, here are my best tips for living without money stress, even if you don’t have a lot of it.

Don’t buy what you want, buy what you need

I live in a small town with a one income family, and I’d rather not move somewhere else if we can afford to stay, so my wife and I have prioritized keeping our cost of living low. In practice this means we only buy what we need and forgo a lot of things we want. We’ve found this to be a very simple and straightforward way to keep spending lower than it otherwise would be. And let me tell you, the trade-off of a slower pace of life has been well worth it!

Save up and pay with cash

Just the other day I bought a used minivan to replace our 12-year old one that was on its last leg. We paid in cash by simply writing a check out to the car dealer, and gained a 3% discount by doing so. I’m mentioning this to show you that paying with cash (or writing a check) is still possible for big purchases, and generally a good idea. We’ve saved up monthly for the past 7 years or so in anticipation of needing a new vehicle one day. This planning ahead and paying in cash means we got to avoid the added stress of a car payment, and the added expense of interest.

Create an emergency fund

Speaking of saving up over time, another smart thing you can do to avoid money stress is having an emergency fund. This is just an amount of money you keep on hand in a savings account in case an unexpected expense pops up, or you have a sudden decrease in your monthly income. In either case, the peace of mind you’ll have by being able to dip into this fund is well worth the effort it takes to build up the funds and let them sit.

Try to avoid using debt

One of the best decisions I made early in my marriage was to avoid debt like the plague. I had seen various family members I loved put strain on their relationships because of debt, and I wanted no part of it. Here’s the thing, avoiding debt slows down your ability to have things that cost more money than you currently have. That’s the downside, but that slowness is also the upside—it gives you time to consider if you really want to buy something, and avoid the stress of trying to pay back something you bought a long time ago but didn’t really need.

Pay down your highest interest loans first

Of course, if you already have debt, the best thing you can do is start aggressively paying it down. Each dollar of debt you pay down today, is a dollar plus interest that you don’t have to worry about tomorrow. The sooner you start, the sooner you’ll have debt-free living as your reward. The only advice you need to know in this matter is to pay down your high interest debt first, and work your way down from there. The longer you let this debt sit, the faster it grows, so get rid of it as fast as you can.

Save a little each month for long-term goals

While college and retirement may feel like a long way off, you’ll be glad you started saving for these goals when you did. Ideally you’ll be investing your money in a low-cost index fund and allowing this money to grow faster than if it was sitting in a savings account. The beauty of saving for long-term goals is that the sooner you start, the less you have to save— the magic of compounding interest does the heavy lifting for you. If you wait until the deadline looms, you’ll be stuck trying to save what you can out of your existing income with little time for the money to grow on its own.

Use a budget to track your spending

It’s hard to live without money stress if you feel like you’re flying blind. And without a budget and ways to track your spending, that’s exactly the position you’re putting yourself in. The solution is to create some kind of budget, it doesn’t have to be fancy, and begin to track how much you’re actually spending in each category. The key is to find an approach that makes sense to you and then to stick with it long enough to see progress. If you’re like me and long written plans too much, consider the possibility that getting started is the most meaningful first step you can take in your journey.