The stigma surrounding the mental health discussion is diminishing as more people come forward to talk about their experiences. Like it or not, money and financial well-being affect our mental health, so ensuring complete control over your money is a must. Hearing advice from an expert in the financial field is one step in achieving this.
fintech times Sit down to talk to him gyro RiverChief Strategy Officer at to push, to discuss this very topic and what clients can do to improve their financial health.
The well-known saying goes, “Money does not buy happiness.” While a variety of factors in life contribute to our well-being as a whole, our financial situation is certainly one of them. In fact, a Staff capital The survey showed that 57 percent of Americans linked their financial health to their overall happiness.
It’s important for us to keep our fingers on the pulse of our financial health to make sure gift buying doesn’t break the bank, especially during the holiday season. But it is just as important (and perhaps more) for us to remain conscious of our financial capabilities because it can negatively affect our mental health.
The science of finance
The effects of our bank accounts on our mental state are well documented – a 2021 study from Harvard university He cites ten studies from the past 10 years that have shown links between poor financial well-being and mental health. The Harvard study found that among the studied group, financial ability and safety were associated with positive physical and mental health. In contrast, financial distress was associated with negative physical and mental health.
Not only does financial distress cause psychological distress – but poor mental health can also lead to worse financial decisions. This causes a vicious cycle of mental and financial problems that feed off of each other and that are difficult to escape from, according to the Institute for Money Policy and Mental Health.
It’s easy to see why. Financial difficulties, such as not being able to afford necessities or collecting debts, can negatively affect mental health by increasing anxiety and stress. Poor mental health, in turn, can affect job performance and productivity, affecting employment and monetary access, while driving the cycle forward again.
a penny saved is a penny earned
Addressing financial issues is within reach and can have a positive impact on mental health. Using these personal finance tools can help improve both an individual’s financial well-being and mental well-being by ensuring financial regulation and financial peace of mind:
- Monthly budget. Having an ongoing monthly spending plan to calculate income, expenses, and savings is a valuable tool to help you live within your means. But by regulating your spending, it also gives you peace of mind to live within your means.
- debt reduction strategy. Like a budget, using a plan to reduce your debt can give you peace of mind as you work to settle it. Whether you focus on your small debt or your commitments with the highest interest rates first, figuring out how to pay them off is easier to consider than unstructured debt.
- Emergency Provident Fund. Facing a lack of income or an unexpected big discount doesn’t have to be a life-or-death situation. Setting aside money as an emergency provident fund can cushion the financial blows and relieve anxiety by ensuring that the principal costs do not become large debts as well.
- Retirement savings accounts. Retirement and living without a fixed income is a major lifestyle change that can cause a lot of uncertainty. Whether you’re using a 401(k) or an IRA, it’s never too early to save for retirement — after all, you’re investing in the peace of mind of yourself for the future.
Show me the money (digital)
Online financial planning tools have made it easy for people to achieve financial peace of mind. Between budget planning spreadsheets, record management software, automated transfers and online banking, digitally simplifying manual processes can remove people’s fears as they transition toward better financial habits.
Moreover, digital money transfer services have emerged over the past decade to facilitate the financial experiences of individuals. These services give people an easy-to-use interface to help them transfer money hassle-free to friends and family in real time or near real time. Knowing that you can quickly send money to anyone can relieve a lot of stress – whether it’s settling debts or giving gifts.
While these tools accomplish different things, they also make the funds more accessible. We maintain a budget, emergency provident fund, debt reduction strategy and retirement savings so that we always have easy access to funds in case we need it. Likewise, digital money transfer services also make it easy to send money to others.