Abstract. Individuals may experience significant financial anxiety as a result of inflation, which reduces the purchasing power of money and causes it to be challenging to afford basic necessities. Workers in the informal sector are excluded from formal protection and are vulnerable to a variety of risks related to income, health, and various other socioeconomic indicators that may affect their standard of living and economic well-being. With rising inflation, the economy's purchasing power is steadily eroding. In such salient times, the working population of the economy is supposed to be worried about their real incomes, especially the informal sector who do not usually have stable income and job security. Financial Anxiety is a psychological phenomenon wherein individuals fail to manage their personal finances without getting excessively worried. This paper aims to understand the financial anxiety among people with reference to the current inflationary pressures in India using primary data collected in the form of survey and personal interviews. It will also be associating financial anxiety with financial literacy to check if people who are financially literate are more anxious or not.

Keywords: financial anxiety, inflation, informal workers, financial literacy, financial stress.