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September 30, 2024
Mental health and financial wellness are two topics that may seem separate but are actually closely related to one another. The concept of financial wellness encompasses your ability to manage your finances. Strong financial wellness is achieved through developing sound money habits, budgeting, and understanding your financial situation. Studies have shown that when a person fails to achieve a strong state of financial wellness, it can negatively impact their mental health.
Stress can lead to issues with both mental health and financial soundness. Stress tends to impair our judgment, leading to impulsive decision making which can ultimately damage our finances. Making good decisions with your finances is challenging when stress becomes a burden on your mental health. This can lead to impulse purchases, late bill payments, and an inability to allocate long-term savings. This can cause a vicious downward spiral where the stress compounds, leading to further financial difficulties.
Stress not only impacts mental health, but many times it also has physical impacts. The physical side-effects of stress can include insomnia, fatigue, hypertension, heart diseases, obesity, etc. Stress can also lead to unhealthy coping mechanisms such as smoking, drinking, or unhealthy diets. Additionally, stress can lead to people avoiding necessary doctors’ visits.
All of these various scenarios can lead to additional expenses and have further negative impacts on one’s financial wellness and mental health.
Taking care of yourself is critical to both physical and mental health. Activities to improve physical well-being include exercise, relaxation practices (such as yoga, meditation, etc.), participating in local events, and pursuing hobbies that interest you. Staying active will improve your physical health, balance your state of mind and allow for better decision making, ultimately leading to better financial outcomes.
Practicing Financial WellnessThere are certain skills everyone needs to learn to practice proper financial wellness, including how to budget, save, invest, and utilize debt. All of these concepts fall under the banner of financial literacy, which is understanding the basics of financial investments and how they work. An understanding of basic financial literacy is closely related to financial wellness, and knowing where and how to utilize these skills to achieve financial stability in a way that’s right for you.
Budgeting is a key first step to regaining control of your finances. Keeping track of a budget can be done using a simple excel spreadsheet or with the help of a budgeting app. By entering your monthly income and expenses into a summary, you can better analyze your spending habits and make sure your expenses are not exceeding your income. If they are, it may be time to re-analyze your spending habits and consider what is most important to you.
Saving and investing money ties back to your budgeting process. If you are able to keep your expenses below your income, you will have extra funds to save and invest. At New Tripoli Bank, you have access to several competitive savings products at competitive rates. Additionally, investing in short-term saving products such as Certificates of Deposit can provide short-term returns on your money.
Debt is an instrument that allows you to access funds to achieve your goals in life. New Tripoli Bank offers a variety of lending products that can help you attain these goals, such as fixed rate mortgages, home equity loans, and personal loans. One of our lenders would love to assist you in reaching your life’s aspirations.
There are several skills you can use to improve your financial wellness, including budgeting, preparing for emergencies, saving and investing, paying down debt, and planning for the future.
There are plenty of tools at your disposal to assist you with improving your financial wellness. These include budgeting apps, setting up automatic bill payment for monthly bills through your financial institution, setting a recurring reminder in your phone to periodically review your financial status, and arranging a meeting with a financial professional. These tools can help take the stress out of improving your financial wellness.
Putting your trust in a knowledgeable professional could provide peace of mind that you are saving and investing in the right products. They can help you set a realistic budget for your lifestyle, review your financials, and guide you into the appropriate financial avenues to achieve your goals.
Mental health and financial wellness are intertwined and if you ignore one the other will suffer. When someone experiences financial stresses, they may become mentally stressed, which can compound into further financial stresses, and physical and mental instability. Improving your financial literacy can improve your financial wellness. Utilizing techniques such as budgeting will help you achieve your personal goals and alleviate stress.
If you’re looking for assistance with your financial wellness, consider reaching out to a Community Banker at New Tripoli Bank. We can help point you in the right direction no matter what part of your journey to financial improvement you happen to be on.
Matthew Koncz is New Tripoli Bank's Controller and an Assistant Vice President. He has been with the Bank for over five years and is responsible for monitoring New Tripoli Bank's financial health. He is also a Certified Public Accountant and has completed educational programs for CPAs offered by various accounting firms and organizations including PA Bankers.
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