Americans feeling the stress from inflation

MINNETONKA, Minn. (FOX 9) - Ask pretty much anyone how they feel about rising gas and food prices, and they won’t have nice things to say. Fox 9 asked a local financial expert and a local psychologist their best tips to relieve the current financial stress and make their dollars stretch further.

A recent national survey shows Americans are more stressed about money than they've been since at least 2015. They’re losing sleep and watching their mental and physical health worsen.

"I'm praying that it stops because it's just like slowly going up each day," said Brendan Schlichting, who was pumping gas in the Twin Cities on Tuesday.

But experts say his prayers likely won't be answered anytime soon, and that's causing some serious wallet woes.

A recent survey from the American Psychological Association found that 87 percent of Americans say the rising prices of everyday items due to inflation is a significant source of stress.

Nicole Middendorf, CEO of Prosperwell Financial in Minnetonka, is definitely hearing that in conversations with clients.

"(They’re asking) ‘What should I do?’ ‘Is there a recession what's happening?’ And that's the biggest thing is don't panic. People shouldn't be panicking, but people are because of what we're hearing out there," Middendorf said.

She said consumers need to ask themselves if an item is a "want" or a "need."

"Maybe you're spending more money filling up your gas tank. Well, what are some other things that maybe need to go?" she asked.

Dr. Sarah Paper, a psychologist at Allina Health, said there’s no doubt everyone’s lives were drastically changed by the pandemic, and now there's money stress on top of that.

"It was the last thing that we needed. We're worried about now our physical health, our mental health, and our financial health, which then affects our relationship health," she explained.

Middendorf said shoppers need to go to the grocery store with a set list of items and a set dollar amount they want to spend, and then, they need to stick to it. It's all about going back to the basics and setting a budget.

"If you have $4,000 coming in, and you have $4,200 going out every single month, you've got to fix something," Middendorf said.

Dr. Paper said for the people who always worry about money, it's even more of a concern now. She breaks down stress into two categories: time to take action and just wait it out. She categorizes the current situation as a little bit of both.

"I do believe that financial stress is one that has a bigger toll on us because it affects so many areas of our life. It affects the quality of food we can eat, whether or not we can afford a gym membership or go out to eat or practice some of those coping skills that get us through hard times," she explained.

But like most problems, Dr. Paper said avoiding money concerns isn't the answer. Instead, she said people should do the math and decide if their drives are worth these high gas prices. Then, start a budget and cut expenses.

To decrease financial stress, Middendorf also recommends increasing one’s cash flow: Start a business on the side or pick up seasonal work. She said it is a good time to invest, so she recommends people look at their 401(k) plans and other investments.

"The Fed has been very blunt that interest rates are going to keep going up. Well, what happens when interest rates go up? Bonds go down. So if you're more of a conservative investor or you're getting closer to retirement, you then want to look at: ‘OK, how much money do I have in bonds and do I need to do something?’" Middendorf said.

Another strategy some consumers may already be implementing: Hold off on purchasing big-ticket items.

"Keeping the lights on and food in my fridge is a little more important than some bigger things I've been wanting recently," Schlichting said.

Dr. Paper said people who make short-term changes now, like learning how to budget, can turn those into long-term habits, and they'll be better off when the financial climate improves.