Coping With Financial Stress to Get Better Sleep

A 2017 survey done by the American Psychological Association found that money is the second most common source of stress for Americans, with Millennials and Generation Z ranking financial stress as their number one source of stress. So how is all of this financial stress affecting our sleep quality? 

A recent study surveyed 1,000 American adults on the amount of debt they owe and the quality of their sleep. The results show that financial stress is a major factor in why Americans are losing sleep. According to the survey, those with more than $60,000 in debt were more likely to report getting fewer than five hours of sleep each night than those with less debt. When they were able to find rest, they reported a lower quality of sleep. 

Losing sleep night after night due to stress can create a vicious cycle. Because sleep deprivation can impact our cognitive abilities, it can lead to a decrease in response time, attention span, the ability to focus, and the ability to commit information to memory.

If you are experiencing sleep loss due to financial stress, the practical tips outlined below may help you break this dangerous cycle. 

Take Inventory 

The first step to reducing financial anxiety is to get a clearer picture of your current financial situation. Avoiding the truth of your finances will only serve to increase anxiety. To gain control and reduce the fear of what might be, consider taking inventory of your current income, financial obligations, and spending habits. This awareness will help you identify areas that might need adjusting. 

Make A Plan

Once you have a better understanding of your finances, you can create a plan to address specific areas of concern. Consider incorporating some of the following into your financial plan to help reduce stress and anxiety. 

  • Cut Expenses. With an accurate idea of what money is coming in and going out each month, you may discover unnecessary spending that can be cut. For example, reducing excessive spending on unnecessary consumer goods and dining out may free up money that could be applied elsewhere. 
  • Create a Budget. Creating a budget allows you to spend within a set limit, ensuring you always live within your means. Be sure to budget for all spending, financial obligations, transportation, and living essentials. This is a great way to control and monitor all outgoing funds. 
  • Get Informed. Getting informed on topics that are sources of financial stress can also help to curb anxiety. If the fear of unforeseen expenses is keeping you up at night, consider getting information on starting an emergency savings fund. Sometimes just knowing the first step toward a goal can help to ease your mind. 
  • Set Goals. After taking an inventory of your finances, you may want to establish some financial goals. Reducing excess spending and sticking to a budget will likely free up money you can put toward these goals. If saving for retirement is a particular concern for you, consider putting this extra money into a savings plan or a 401(k). This will go a long way in reducing your nighttime worries. 

Emergency Savings

Many of us may toss and turn at night with thoughts of “what if.” Creating a plan for potential emergencies may help you rest easier at night. This type of account works best when it is kept separate from all other savings accounts and is only used for emergencies. When an unexpected home or auto repair, medical expense, or fee comes up, you will be glad you have this money set aside.

Automate Your Finances

The survey mentioned above also discovered that delinquent payments were a major contributor to nighttime stress. Americans who were behind on payments were more likely to feel stress and worry over finances. Automating your monthly bills can help reduce anxiety and give you peace of mind knowing that your bills are taken care of on time. 

Once you have established financial goals for yourself, you can also automate these payments. Automating these payments is a convenient way to ensure you reach your goals on time. 

Sleep Hygiene 

To help you find the best sleep possible, you may want to consider your sleep habits in addition to your finances. When we establish healthy sleep habits, our quality of sleep can dramatically improve. Consider incorporating some of the following into your nightly routine: 

  • Sleeping on a supportive mattress
  • Creating a set sleep schedule 
  • Keeping your sleep space cool and dark
  • Reducing exposure to electronic light at least 2 hours before bed
  • Getting regular day time exercise
  • Avoiding large meals before bed

When stress prevents us from finding a good night’s sleep, the effects can spill over into all areas of our lives. Consider following some of these practical tips to reduce your financial stress and find more restful sleep.


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