How to put the Right Perspective on Finances

It is tax season. This simple fact can produce some very unnecessary stress for people if they let it take over their lives. My advice is to put things in their proper perspective and not to allow a simple yearly financial ritual to overwhelm your life and affect your well-being.

It starts with a tax deadline that becomes a large problem for some people as they get closer to the end of April. The media is quick to remind us that we have reached the end of the line for filing our taxes and they help make a mountain out of this molehill. The process becomes a much larger-than-life obstacle and people tend to run with it because some people love to include a sense of turmoil in their lives, whether real or imagined.

Most people will find that their tax obligation will either be non-existent or can be repaid by a payment plan worked out with the CRA if people do not have the entire amount of tax repayment money available to them at the time. The key issue for people who fear tax season is their urgent need to get the process into “matter of fact” territory and deal with it accordingly. Tax season is not one of those life-changing moments; it is simply an annual ritual that is part of everybody’s lives.

Personally I view tax season in the same vein as my annual physical exams and tests, so I include all of these events as part of my “matter of fact” life package. It tends to lower my anxiety levels to a reasonable stress level that is more appropriate for these occasions and places them much lower on my own list of reasons that should produce stress. It becomes a matter of perspective and I firmly believe that tax season is not a strong enough stressor to produce a high level of anxiety in the grand scheme of life.

The idea of stress response is based upon a physiological fact from our evolutionary past because it is only designed for brief moments of perceived danger to initiate a heightened flight/fight/freeze survival response. Too much prolonged stress can produce some very negative effects on our long term health, so it becomes even more critical for us to put our stressors in their proper place in our lives. Tax deadlines should not be high on our list of stressors.

The broader notion of personal finances should also be part of the bigger picture because each of us has our own philosophy about money. Some people with a great deal of money tend to worry too much about their financial picture to the point of a personal health risk, while others with limited financial resources have a better attitude about the priority of finances in their lives and consequently they enjoy better physical health.

Here are a series of questions about your personal attitude toward finances that you need to ask yourself:

• What do you feel when you think about your personal finances? Do you feel a sense of calmness, empowerment and at ease, or do you tense up and feel a sense of dread and tightness in your stomach?
• Can you identify your personal beliefs about money and are they positive or negative attitudes about money?
• Where did you develop your views toward money and were your views developed through your relationship with your family and their experiences?
• Have you made an effort to better understand your financial picture? If so, did you enlist the help of your friends or family in this process?
• Have you encountered personal financial problems and how has your attitude played a role in the experience, both as a root cause and in your coping mechanisms?
• What have you learned from your past experiences with financial problems?
• Have you repeated the same behavior pattern that has not worked in the past when it comes to your personal financial choices and when did this pattern start in your life?
• Have you enlisted other people who are close to you that have good financial management skills to mentor you as role models in the area of financial advice?
• Have you considered other revenue streams to alleviate your financial strains? Have you considered sharing goods and services with others in a barter system to lessen your financial burden?
• Has your problem reached a point where you need to enlist the aid of a credit counseling service to address your financial situation?
• Finally, can you envision a better world where your financial concerns do not consume your life? These are the questions that you need to ask and answer for yourself before you take the next step toward placing them in their proper level of priority in your life. Financial concerns can indeed be managed and then you can then enjoy one less source of stress in your life. The most important thing is to prioritize the financial problem and determine whether it is a real concern or simply an unnecessary overreaction to a simple financial matter. Either way, you will be able to reduce its stressful effect on your life if you take the right steps to solve the problem.