Your finances and your mental health are closely tied, so it makes sense to work on these in tandem to improve both at the same time. Financial stability can give its own sense of happiness and mental relief, like the freedom of having more choices in life, having built better financial habits.
When it comes to savings, poor mental health can become a barrier to achieving the goals you have. Here we’ve gathered how better money management through building savings can uplift your mental health as well as some tips for keeping you on track even when times get a bit harder.
Building stability
Savings can often create a great sense of stability, and help to dispel any worries you have about the unknown. Knowing you have an additional safety net when it comes to money can give you one thing less to have additional anxiety over. Perhaps your savings are for an emergency fund, or maybe you’re making regular contributions to reach a bigger goal like a car or a house. This links to the findings from wider studies on the benefits of being able to access and make good use of financial resources, and that being financially capable has a great influence on cognitive and physical health.
Our savings accounts are designed to help you reach both long and short term goals. Whether you’re looking to build up your savings without the temptation of drawing out funds easily, or you’re just starting with saving but may need to dip into these quickly, we have a range of products for you to choose from depending on when you’ll need to access your cash. For long term major savings like retirement or children’s futures, a Fixed Term Account helps to secure your money so that it can’t be touched while keeping securely locking your savings to grow and guarantee an interest payment. Easy Access Savings Accounts are best suited for when you need to get to your money quickly, and thanks to next day access, you’ll be able to get this urgently.
Reducing stress, finding solutions
Needing to access bigger amounts of cash can often be coupled with a stressful event such as losing your job or a pet illness. Simply knowing that you have savings should you need to access them can hugely reduce the amount of stress you have about money. Emergency funds are typically used to this effect to help prepare you for times like these but to also boost your mental health in good times. There’s even a shift to seeing these savings referred to as solution funds, as they’re designed to take the triggering aspect away from needing to access this money. Now the money can be viewed as a ‘problem solver’ or ‘stress reliever,’ with no shame in needing to access this.
Saving for possibilities such as these can really help to manage any stresses that arise from money worries. But even if you don’t already have the savings now, the process of planning and starting to save for these cases can be therapeutic itself and help make you more resilient to other stressful things in the future.
Forming good habits
The process of just starting your savings journey with contributions to your savings goals can begin to build good habits. Developing healthy habits has been found to improve self esteem which can reduce the impact of worsening mental health through anxiety. So, regular contributions into your savings can turn a good habit into consistent little mental health boosts. Think of transferring to your savings as a non negotiable bill and making paying yourself first a priority. So building in this regular savings can be looked at as building in good mental health practices, that you’re effectively purchasing your sound peace of mind.
Working on your savings goals can help steer you away from areas that could have a negative impact on your mental health such as overspending. By sticking to a budget where savings are prioritised and removing more of the bad habits, this can all feed into an overall higher wellbeing and increased levels of happiness.
Achieving goals and going beyond only your needs
It’s great to pull out the benefits of the process of building your savings, but don’t forget to lose sight of what your savings are setting you up for. Your savings goals are there to reduce the financial burden of helping you achieve what you want. And there’s plenty to celebrate and be proud of for achieving this.
Savings allow you to not only pay for what you need but can help realise bigger ambitions. They can help you with making improvements in your day-to-day life like upgrading tech, or taking that trip or seeing that concert you’ve always wanted to tick off. There’s huge value in your mental health for that, and when you do achieve the amount you’re aiming to save, enjoy the feeling.
Giving you options
By moving your perspective on money to appreciate what savings can do for you, you’ll see how having more financial freedom provides you options in your life. Having options gives you the autonomy to make choices that can boost your mental health rather than hinder it.
While this is easier said than done in the face of a recession, keeping savings as a priority will stand to benefit your mental health greatly, though this may involve adjusting the amount you commit regularly. By continuing to contribute where you can and potentially cutting back in other areas to maintain this priority, when the time comes that you really do need to access this, you’ll be grateful that the option is there.
Tips on prioritising saving for your mental health
Visualise your goal you are saving for
Picture the retirement plans, your children’s future or your next big trip when you’re making your contributions. You can keep reminders of them around by having pictures or naming your accounts which is something you can see in the OakNorth app.
Pay yourself first
Treat your own mental health and savings like a bill that needs to be paid. When you think of savings as non-negotiable, it makes it easier to prioritise. It’s also easier to do this when you are first paid and not relying on only adding to your savings from what is left at the end of the month.
Factor in rewards for hitting targets
Make sure to reward yourself for hitting your savings milestones. This doesn’t need to be something you have to spend extra money on, and could be as simple as taking a favourite weekend hike or visiting your friends’ new baby.
While it’s been demonstrated how great prioritising your savings can be, there will always be a limit to how much you can contribute and it’s important to know it’s okay if you can’t always meet your savings targets, especially in the current conditions. Savings may need to fluctuate depending on your circumstances and what will work for some people may be different for others, but knowing the impact of savings may inspire you to push yourself to start your own savings journey sooner.
