The Vital Connection: Saving Money and Your Emotional Wellbeing

BY: Neighbors’ Consejo|

In the relentless pursuit of success and prosperity we often find ourselves navigating a complex maze of financial decisions. Our society places a premium on earning more, spending more, and acquiring more, often leaving us feeling trapped in a cycle of financial stress and emotional turbulence. It is easy to overlook a fundamental truth: The way we handle our money can have a profound impact on our emotional wellbeing.

According to Bankrate, more than half of Americans are behind in saving for retirement, and 16% of Americans aren’t saving at all [1] . So, why should you start saving money today [2] ? “Saving can give you freedom; saving provides financial security: saving means you can take calculated risks.

Barbara O’Neill, Ph.D., from the Extension Specialist in Financial Resource Management of the New Jersey Agricultural Experiment Station [3] , affirms, “saving provides a financial “backstop” for life’s uncertainties and increases feelings of security and peace of mind. Once an adequate emergency fund is established, savings can also provide the “seed money” for higher-yielding investments such as stocks, bonds, and mutual funds.” Bankrate [4]  mentions 7 reasons to save our money:

  1. Having a safety net during hardships
  2. Meeting life goals
  3. Work flexibility
  4. Reduced tax liability
  5. More travel opportunities
  6. Relieve financial stress.
  7. Helping others

What is the relationship between financial and mental health? “Debt and financial problems can lead to poor mental health, such as chronic and long-lasting stress. And many people feel that money stress is harder than work and family-related stressors. Not surprisingly, if a person’s mental health is already bad, their financial wellness is also put at risk [5] .”

The same source [6]  affirms, “unfortunately, many Americans don’t feel great about their finances. In fact, 42% say the money is negatively affecting their mental health, leading to stress, worry, anxiety, and feelings of insecurity. Millennials are the most anxious about their finances (48%) with Gen Xers a close second (46%).

How can we save money [7] ?

  • Eliminate your debt
  • Set savings goals
  • Pay yourself first
  • Stop smoking
  • Take a staycation
  • Spend to save
  • Utility savings
  • Pack your lunch
  • Create an interest-bearing account
  • Annualize your spending

Ultimately, the importance of saving money for emotional wellbeing lies in its power to grant us peace of mind, a sense of purpose, and the freedom to lead a life that aligns with our values. It is a small investment that pays immeasurable dividends in our journey towards a happier, more emotionally fulfilling life. So, let’s start saving today, not just for our financial future, but for our emotional wellbeing as well.

References

 [1]https://www.bankrate.com/retirement/how-to-save-for-retirement/

 [2]https://www.discover.com/online-banking/banking-topics/3-reasons-to-save-more-money/

 [3]https://njaes.rutgers.edu/sshw/message/message.php?p=Finance&m=122

 [4]https://www.bankrate.com/banking/savings/top-reasons-to-save-money/#:~:text=Saving%20is%20an%20important%20habit,money%20can%20help%20you%20thrive.

 [5]https://www.securian.com/insights-tools/articles/relationship-between-financial-mental-health.html#:~:text=Relationship%20between%20financial%20mental%20health&text=You%20pay%20your%20bills%20on,is%20good%2C%20life%20is%20easier.

 [6]https://www.securian.com/insights-tools/articles/relationship-between-financial-mental-health.html#:~:text=Relationship%20between%20financial%20mental%20health&text=You%20pay%20your%20bills%20on,is%20good%2C%20life%20is%20easier

 [7]https://www.regions.com/insights/personal/personal-finances/budgeting-and-saving/10-best-ways-to-save-money

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