Tips on dealing with financial stress and attacking debt

MINNEAPOLIS -- Financial anxiety is up. Economic factors like inflation and rising interest rates are a pain point.

Many Minnesotans get a sinking feeling when you ask them about the economy and finances.

"I have a lot of worries about my family. I don't know how they are going to afford a home, mortgage, buying a car, everything," said Eugene Paddock of Cottage Grove.

"I would say the biggest concern for my family is just the increased cost of everything," said Shane Hartmann of Richfield.

"Prices to get things done are becoming unaffordable," said Jacki Broze of Plymouth.

These Minnesotans aren't alone in their worries. A new Bankrate survey found money is a significant cause of stress for most Americans.

Just over 50% say money has a negative impact on their mental health, up 10% from a year ago.

Among those, 82% say feelings of stress, anxiety, loss of sleep, and depression are caused by economic factors.

"The increase is really driven by inflation first and foremost. Also, adjacent topics like day-to-day expenses being higher, not having enough savings," said Ted Rossman, senior industry analyst at Bankrate.

Rossman is also concerned about how much households owe as consumer debt is now over $17 trillion dollars.

"I think we're starting to see some of the cracks emerge in terms of more delinquencies, higher balances. Especially lower income and lower credit score individuals. They are the ones that are the most vulnerable," said Rossman.

Personal finance expert and best-selling author Anthony O'Neal says a lot of people are racked up in debt from the holidays.

RELATED: Take control of your money with these budgeting tips

"Especially Christmas time and because of inflation, and because of some jobs being let go, people really didn't take their debt seriously," O'Neal said.

O'Neal says to reduce financial anxiety, turn your focus from large-scale economic issues to making changes at home.

"We can't control the economy, we can't control what they're going to do, but what we can do is we can control is our home economy," said O'Neal.

To take control of your money, O'Neal first recommends setting up an emergency fund.

"Go ahead and put a thousand dollars into an emergency fund. Then we're going to eliminate the debt," explained O'Neal.

O'Neal says having that reserve is huge from an emotional standpoint.

"Say you get let go from your job, let's say something happens with your car. You're still a little stressed. Let's be honest there. But you're not as stressed because you've got something to fall back on and it buys you time to put a system and a strategy in place to recoup those funds," said O'Neal.

Then the goal becomes paying off credit card debt so you can save and invest.

"You need to aggressively attack this, because the quickest pay raise we can get is eliminating debt and especially debt with high interest rates," said O'Neal.