Personal Finance

5 bad money habits to break for a better night's sleep

Poor money habits can lead to high stress levels and disturbed sleep. If that sounds like you, here are some top tips to make you more financially savvy, and help you sleep easy as a result!

Whether you're in debt or struggling to afford the daily costs of running your home or raising a family, those under financial strain typically suffer from mental health issues as a result. With average non-mortgage household debt in the UK currently standing at £12,765, money worries contribute to stress, anxiety, depression and insomnia in many people. If you're not getting a good night's sleep because of money worries, here are some tips to help regain controls of your finances:

Track your spending

The first step to fixing any problem weighing you down is to identify it. Money doesn't just disappear of its own accord, we spend it. Therefore tracking your spending is the first step to getting your finances back on track.

Something you can do for free is request a printed statement from your bank going back at least 3 months. Have a sit down with some highlighters, marking off everything which is not a necessary spend, such as unused gym memberships or other forgotten about direct debits. This is an excellent way to also see how seemingly little purchases such as trips to the coffee shop soon add up over the space of a month.

You can also create an excel sheet and work out how much money is coming in vs how much needs to go out. If there's a shortfall you can obviously look for ways to reduce unnecessary spending (e.g., don't buy water or coffee out, reduce your clothing budget this season, etc.); alternatively you might consider changing jobs or starting a side hustle to earn some extra money on the side.

Start tracking your bank statement on a daily basis instead of being too afraid to check. The more in control you become of your spending, the less you will worry at night and the better sleep you'll receive in turn.

Create a budget

One way to reduce financial stress is to set a maximum spending limit each month. Once you've factored in rent/mortgage, bills and other essentials, calculate what you can realistically afford to spend from what's left over.

The goal is not to have your bank balance reduce to zero or end up in your overdraft, as it's always a good idea to have some contingency money in case of unexpected bills. Every little bit that's left each month will help build your bank balance back up.

Since food is such a big budget expense and an easy area to overspend, taking a list to the supermarket and only buying what's on the list can help you avoid a nasty surprise at the checkout.

Sticking to your budget will help reduce stress, as you will be acutely aware of what needs to leave your account and how much is left over, letting the money worries slowly melt away.

Use credit cards and personal loans responsibly

Whilst credit cards and personal loans can be beneficial, they can also be the source of many people's stress, anxiety and insomnia, not to mention depression when they feel trapped by the repayments.

Credit cards give payment protection on goods making them a smart purchasing method in certain cases. The trouble is it's all too easy to overspend on them, potentially leading to high interest charges and debt if you can't afford to pay back in full each month.

After all, there is no such thing as free money! By only spending what you can afford to pay back each month, this will allow you to reap all the benefits of owning a credit card without the financial penalties.

Personal loans typically offer lower interest rates, but these still can lead to a poor sleep as they still have to be repaid. Consider why you are seeking a personal loan, and if there is a better option instead.
To every extent possible, avoid payday loans entirely as they charge exorbitant repayment rates of up to 1,500%. Worryingly, many will give you the money in your account within 10 minutes which is not enough time to thoroughly reference candidates for financial suitability, or for you to think about whether it's a good move. Top tip - it's not and you may be absolutely crippled with debt for years to come.

Cut out impulse spending

It sounds simple enough but impulse spending can quickly become addictive, destroying credit ratings and wiping out bank balances.

Many will impulse buy in relation to their emotional state. For example those who have been promoted at work may rationalise that they deserve a treat. Equally, those who've had a bad week at work might do the same.

If you do notice your spending habits correlate with your mood or well-being, then it's a good idea to tackle this by talking to your employer, friends or family to find a creative alternative to impulse spending that's easier on your bank account!

Also look to avoid impulse spending whilst out shopping, especially in supermarkets which overwhelm us with so called 'bargains' and 'amazing deals'. If you didn't absolutely require what they are selling and won't use it up entirely, then it's a loss. Simple as!

Get protection for unexpected events

If you don't have a lot of savings, an unexpected event like an ill pet, burglary, a cancelled holiday or even a damaged mobile phone can cause incredible financial strain.

Take stock of what's valuable in your life (e.g., your pet, your gadgets, your bicycle, your clothes, even your summer holiday, etc.) and find suitable insurance policies to protect them. You may be surprised to find that insurance doesn't cost as much as you think, and can potentially save you thousands of pounds in the event of a covered event. For example, you can buy a cheap travel insurance policy for as little as £5.


Poor money habits can lead to high stress levels and disturbed sleep. If that sounds like you, here's some top tips to make you more financially savvy, and help you sleep easy as a result!


Our team of writers has expertise in business, car, travel, home and pet insurance as well as personal finance issues.


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