No matter how much money you make, if you have ever lived paycheck to paycheck, you understand the rising anxiety as the first of the month approaches. The angst that keeps you from opening the credit card bill that arrives right on time every month, begging for your attention. The nagging fear of an overdue car repair, an unexpected medical emergency, or job loss. The “money sickness” caused by financial worries can negatively affect all aspects of our life, including our health, relationships, and work performance. Financial concerns eat away at our mental well-being, stealing our joy and peace of mind.
Yet many Americans live precariously from paycheck to paycheck. A majority of us, actually. We spend our days trading our precious time for pay and still struggle to stay afloat. According to Bankrate’s Emergency Savings Survey from June 2021, more than half of the 1,009 respondents reported holding less than three months’ worth of expenses in an emergency fund.
And while high-income earners – those bringing in $75,000 or more per year – are more likely to have accumulated some savings, only 43% of respondents said they had at least six months’ worth of living expenses in emergency savings. Despite the amount of money coming in, a surprising 32% reported having less than three months’ savings or no savings at all. With the damage that financial struggles can cause, what is underlying these numbers?
Why Can’t We Save? It’s Not An Issue of Budgeting. It’s An Issue of Financial Mental Health.
While we may have experienced a financial setback such as a divorce, an extended illness, unemployment, or underemployment, the primary reason we don’t have money in the bank is not that we don’t know how to add, subtract, or create a budget. It’s because we have not learned how to manage our desire to consume. We have not successfully restrained our ever-evolving wants.
We are bombarded with messages about what it looks like to have money. Money flows freely in the shows we watch, the magazines we read, and the posts we see on social media. People around us seem to have more, and we want what they have. But we are being fooled about what it actually means to have wealth.
We can appear to be wealthy – driving expensive cars, wearing designer shoes, living in prestigious neighborhoods – while secretly flirting with financial disaster. We fool ourselves into believing that if we wear the “right” clothes or take the “right” vacations, we have made it. That our possessions and experiences prove that we are successful and worthy. We allow what I call “SocieTHEY” to define what “right” means and how we measure our value. And in trying to prove ourselves to others, we put ourselves and our families at risk financially by not building adequate savings for emergencies and investments for long-term wealth and security.
It’s easy to spend more when we make more. But why do we fall into this trap of lifestyle inflation? We trip up financially because of our money mindset. We care about what others think, elevate our expectations, and feel entitled to more. We think, “I deserve this.” And so we spend instead of saving and investing. We succumb to SocieTHEY’s peer pressure, we buy into what marketers are pushing, and we are “instagramified.” These outside influences create insatiable cravings in us, and if we have not developed a wealth mindset, we give in to these cravings. We spend, spend, and spend some more.
The Damaging Effects of Financial Strain
A showiness of money that does not arise from actual wealth can cause significant financial troubles. These money difficulties can, in turn, ruin your health, your marriage, and even your children’s relationship with money. Conversely, eliminating financial stressors from your life is one of the surest ways to find peace of mind.
Several scientific studies have investigated the link between wealth and positive health outcomes. Multiple studies have demonstrated a positive correlation between financial stability and personal well-being, both mental and physical. Researchers have also found that the anxiety of financial problems can negatively impact heart health and cause people to engage in behaviors that can take years off of their lives, such as smoking and overeating. Research shows that money sickness is real, and chronic financial strain can cause symptoms similar to Post-Traumatic Stress Disorder.
Financial strain can also end marriages and break up families. Money is one of the top three causes of divorce with challenges ranging from incompatibility in financial goals and spending habits to pressure from excessive debts to imbalances of power caused by one spouse bringing in significantly more money than the other.
Our children are also impacted by our money problems. One of my students shared how her mother had trouble getting out of bed on the first and fifteenth of the month – when the bills were due. To this day, my student feels anxiety on the first and fifteenth of the month, even though she is financially stable. She inherited her mother’s money sickness despite having a significant emergency fund, savings, and investments, including her own home. Children can feel the anxiety caused by money challenges. As a result, they may also end up having a troubled relationship with money when they become adults.
Financial Mental Health: How the CB4UB Method Can Change Your Relationship With Money
Let’s talk about getting your financial mental health in order. My mantra in practicing financial mindfulness is “Crawl Before You Ball” or, in short, CB4UB. Save before you spend. Delay gratification. Understand the difference between something that is truly a “need” versus something that is simply a “want.” Fund that emergency savings account – my recommendation is two years’ worth of expenses to give yourself space to breathe in an emergency – before you attempt to live a lifestyle that will put you and your family at financial risk. My grandmother shared her version of CB4UB with me: “Do what you have to do so you can do what you want to do later.” Her financial mental health enabled her to save and invest, passing on a firm foundation of financial wellness to her children and grandchildren.
Getting your financial mental health in order by following the CB4UB philosophy is a process that first requires an honest assessment of where your finances are today, as well as an acknowledgment of your past financial mistakes. Yes, these steps are necessary and, yes, they may be painful, especially in sharing this information with your spouse and family. But owning these truths – as difficult and embarrassing as it may be – will clear the slate and start you on a new path toward improving your financial mental health – and your financial situation.
Along with creating a viable plan with your partner and family to save money, CB4UB requires you to practice financial mindfulness in blocking out the pressures from SocieTHEY, advertising, and social media. Letting go of your concern about what others may think becomes easier when you celebrate small changes in your spending behavior, see your financial cushion grow, and feel your financial pressure easing. In practicing CB4UB principles, you take control of your money and cease to let it control you.
Our best life is not about having the best things. It’s about peace of mind. It’s being able to make decisions without money being a factor. It’s teaching your family’s next generation about the benefits of having a healthy respect for and positive relationship with money. Over time, practicing the principles of CB4UB can transform your income into the wealth that can buy you financial freedom – freedom to choose the work you do, how you spend your time, and from worry about being able to take care of yourself and your family in an emergency. And when you free yourself from the anxiety of living paycheck-to-paycheck, the first of the month becomes just another day in your more peaceful and joyful life.
Written by Buffie Purselle.
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