It’s a scary time financially. How to avoid panic

Amanda Collins describes the experience of being out of work for seven months in one word: “Maddening.”

She was furloughed in March from her job in the I.T. department at the John F. Kennedy Center for the Performing Arts in Washington, D.C. Collins was confident she’d be called back soon, but four months later, she still hadn’t been. Then she was laid off.

Grief engulfed her. “I assumed I would be there for years,” Collins, 39, said. “I mourned my job for two weeks straight and was more or less useless.”

More from Personal Finance:
Here’s what I bought during Amazon Prime Day
What to watch out for with retail credit cards
It might be worth it to move to a cheaper city

What followed were months of isolation and unanswered job applications. Her savings are now gone, and her mood can get pretty dark. “Sometimes, every day starts to look the same, and absolutely nothing seems appealing,” Collins said.

Anxiety around money has spiked this year. Around 64% of adults report that finances are “a significant source of stress” in their lives during the pandemic, according to recent findings by the American Psychological Association.

Why wouldn’t we be afraid? More than 45 million people have filed for unemployment this year. Millions are losing their homes, falling behind on their bills and unable to afford enough food for themselves and their children.

Even many of those who still have a job fear losing it, and it’s hard to find someone who hasn’t had some plan derailed. Nearly a third of people, for example, say Covid-19 will delay when they retire.

“There is so much uncertainty these days, and that uncertainty leads to increased fear, anxiety and in some cases, panic attacks,” said Jennifer Dunkle, a financial therpaist in Fort Collins, Colorado.

Anxiety can be confusing and even paralyzing. As a result, it may be hard to think straight until you can calm down a little, said Dr. Mary Gresham, a financial psychologist in Atlanta.

“Solutions generated in desperation and when stressed tend to be short-sighted and narrow,” Gresham said.

Meditation, eating healthy, getting enough sleep and avoiding alcohol can all reduce stress levels, she said.

Jeff Shinal, a financial therapist in Leesburg, Virginia, advises people in a panicky state to label their emotions. Putting them into words, he said, can decrease their intensity and power over you.

In your worst moments, Shinal said, try focusing on your five senses — what you can see, smell, hear, taste and touch. Doing so can put a temporary stay on spiraling, doomsday-type thoughts.

Listening to calming music, he added, or making a list of the things for which you’re grateful can also dull anxiety. As can avoiding social media and the news, he said.

These days, it’s easy to have fears about the future.

“Many of my clients are business owners who worry about the continuity of their business,” Shinal said. “My clients with regular jobs are concerned about the stability of their employment and their employer.”

Yet giving into despair will just compound your problems. Instead, Shinal recommends trying to decipher what is within your control from what is beyond it.

“Make an honest inventory of what you can do to change your situation right now,” Shinal said. “From that list, develop an action plan.”

For example, maybe you can’t do anything about the current limit on people you can serve at your restaurant but you can try to expand your take-out options. Or, it can be hard to know for sure if the company you work for will survive the pandemic but you can check in with your boss to try to stay updated.

If you’ve been in a really bad rut, it’s important to set reasonable goals, said Tara Unverzagt, a financial therapist in Torrance, California.

She recommends asking yourself: “‘What is one thing I can do today?'”

Maybe that’s taking a walk, locating your resume, posting on LinkedIn that you’re looking for work or researching an online class that will help you freshen up your skills.

“Do that one small, easy to accomplish task — no more,” Unverzagt said. “The next day, do one more thing.”

Try to identify your biggest “money stressor,” said Dr. Vaile Wright, a clinical psychologist and senior director for health care innovation at the American Psychological Association. Perhaps that’s a large, unexpected medical expense or not being able to meet next month’s rent.

Next, think about creative solutions to that problem. Some states, for example, have emergency funds you can apply to. Meanwhile, certain lenders are offering accommodations during the pandemic and it’s worth asking for them.

If you’re more worried about what could go wrong than what has, Unverzagt recommends coming up with a “set it and forget it” plan.

You might say, “‘If I lose my job, I’ll need money in the bank to tide me over until I get a new job,'” she said, and so, “‘I’ll start auto-saving $100 a week to help cushion the blow'” if that happens. Doing so will hopefully make you feel more prepared and less anxious.

If you haven’t already, creating a budget can help you to better understand and then address your financial challenges, said Debra L. Kaplan, a financial therapist in Tucson, Arizona. Make a list of the money that comes in and what has to go out each month.

“Cutting out unnecessary expenses goes a long way to being active in the solution against feeling powerless and financially vulnerable,” Kaplan said.

It’s crucial, Unverzagt said, that people reach out to others during difficult times.

Some people don’t want to vocalize that they’re struggling, she said, but hiding the problem doesn’t make it go away. More often, she said, it makes it worse.

“Don’t let shame and embarrassment prevent you from getting the help you need,” she said.

You might even be pleasantly surprised by what comes out of a phone chat with an ex-coworker or family friend. “Most people I’ve seen get a job in the last year did it because a contact they knew got them the interview or gave them a reference,” Unverzagt said.

If your stress and sadness persists and sharply limits how much you can do, you may want to consider seeing a therapist, experts say.

The American Psychoanalytic Institute lists centers where psychoanalysts-in-training see patients for a relatively affordable fee. Open Path connects people with therapists who offer sessions for as little as $30, and on the American Psychological Association’s website, there’s a pretty comprehensive guide to finding professional help.