How to navigate financial anxiety in the face of bank collapses.

With recent bank instability, including the collapse of Crypto Bank, Silvergate, and SVB Financial Group in Santa Clara, it is understandable that this can be a source of financial anxiety. Whether you are an investor, a customer, a business or venture capitalist banking with these banks, and/or you are concerned about your bank or are employed by one of these banks, there are steps you can take to manage your anxiety and overwhelm as well as protect your finances. Here are a few tips how to navigate this tumultuous time.

Focus on what you can control

Hearing news such as a bank collapsing can ignite your sympathetic nervous system (SNS). Your SNS is a network of nerves that helps your body activate your "flight-or-fight" response. By doing a quick body scan, you may notice tension in your neck, a racing heart,  sweaty palms, or a pit in your stomach. Notice this is happening by stating, “I notice that...".  These body indicators are likely related to feelings or emotions which could be anxiety, overwhelm, and feeling scared or nervous. These reactions are completely normal. To regulate your mind and body, take a few moments to do some deep breathing, or another option is to sit and push your feet in to the floor. These grounding techniques will bring you back into your body and move you into a more relaxed and in control state.

Limit the amount of information you take on daily

Naturally, you will want to know the latest information. However, accessing it repeatedly throughout the day makes you at risk for overstimulation ad overwhelm. Being intentional about how you receive that information is important. Note that cortisol levels tend to be highest in the morning so using this time to do low stimulus activities will benefit your wellbeing for the day. Plan the times of the day that you will seek information and how long you will spend scrolling or reading information. Additionally, source solid and reputable news sources that provide you with unbiased information. Remember that headlines are meant to evoke emotional responses or feelings.

Connect with your bank

Identify the proper channels to access the latest information. You are likely to have a lot of questions. A notebook is helpful in this situation to reduce overwhelm by jotting down who you spoke with, and any key information learned. Also, understand who your regulators are. List key contacts, websites, etc. Seek clarification about your concerns.

Evaluate your options

As trust may be disrupted or you are feeling anxious about the possibility of a bank collapse or your employment, it can be helpful to consider your options. For customers and investors, you can research different banks, diversify your funds by spreading your money across multiple banks or investing in other assets, such as stocks or real estate. This can help to reduce your risk and give you some peace of mind.

For employees, your future earning potential may be at risk so updating your resume and reaching out to your network is essential at this time. Additionally, review your finances and your budget. Make tweaks as necessary. Employ or fund your emergency fund to provide a buffer if there is a delay in pay or severance. Your general wellbeing is also important. Make sure you practice self care such as eating well, getting enough rest, and exercising regularly. 

Review your accounts

Assess your checking, savings, bonds, and investments. Note any risks that may arise as a result of your accounts. Most accounts are insured by the Federal Deposit Insurance Corporation (FDIC) or a similar organization in other countries. This means that if your bank were to collapse, your deposits would be insured up to a certain amount, typically $250,000 in the US. So, even if the worst were to happen, you wouldn't lose everything.

Seek professional support

Know that you are not alone as you navigate this experience. There is ample support available to you through groups, social media, financial therapy, general therapy, and financial advisement.  If you are struggling with financial anxiety, seek the advice of a financial therapist or adviser to help you manage your anxiety or help you to manage your finances during this challenging time. 

Remember, it's okay to feel worried or overwhelmed in situations like these. Allow yourself to feel your emotions and seek support when you need it. We have all done hard things before. Life is a journey and humans are resilient by nature. These tips will help you to stay calm and focused and prevent you from reacting emotionally or impulsively. Being intentional goes a long way to minimizing the impact of the collapse, or potential collapse, on your wellbeing and your finances.

If you would benefit from wellbeing support, consider my 1:1 sessions.

Photo by Karolina Grabowska