Savings and Your Mental Health

Savings. Believe it or not, there are certainly many tangible benefits to saving money. In fact, being able to purchase the things that you want or need (now or in the future) is probably the number one reason that we save. But what if the intangible benefits of saving money may actually be more important than the simple act of adding extra zeroes to your bank account? For many, the act of saving itself can have a profound positive impact on their mental health.

1) Forming good habits – In a world filled with endless potential for distraction and instant gratification, regularly denying yourself a portion of your income is a hard habit to form. Starting to save can be a daunting prospect, and continuing to save can be even harder. However, if you “flex” this savings muscle it is an excellent way to develop self-discipline. This discipline can easily spill over and help you develop form good habits in all areas of your life.

2) Security – Running out of money is stressful. Whether you fear living month to month, a big unexpected medical expense, or the possibility of having another set of twins (or triplets!), having a savings cushion does wonders for your sense of security and peace of mind. Everyone might have a different number that makes them comfortable, but simply saving towards an emergency fund or nest-egg gets you a little bit closer to that sense of full fiscal security; reducing stress and allowing you to sleep a little better each night.

3) Generosity – While you certainly don’t need a big savings account to be charitable, having enough money for yourself and your family affords you a greater opportunity to see the needs of your friends and community and lend a helping hand. According to the Cleveland Clinic, not only do you help others when you give, but you experience physical and mental health benefits as well:

  • Lower blood-pressure
  • Increased self-esteem
  • Lower levels of depression
  • Longer life

4) Freedom – An unfortunate reality of modern life is that we sometimes compromise our physical or mental health if we don’t think that we have enough money to make another choice. Saving can allow you the freedom to make important choices unencumbered by financial factors. This financial freedom can extend to choices in your career, where you live, and even your relationships. Feeling trapped in a situation is never good for your mental health, by having the freedom to make your own choices, you can be confident that you are making the best choices for you, whatever they may be.

Now, money can’t solve all of your problems, but it is clear that a diligent savings routine has clear benefits beyond your balance sheet. So while you should certainly do your best to be content wherever you are, spending less and saving more can help more than you know.