Percapita

In today's fast-paced world, the state of our finances is often deeply intertwined with our mental well-being. A 2022 study by Lu Fan and Soomin Ryu highlights just how valuable feeling good about money can be.¹ 

Their study found that “financial worries are positively and significantly associated with psychological distress”—which is no surprise to those of us who live that experience.

For many of us, financial wellness doesn’t feel readily achievable. But reducing financial stress doesn’t have to mean changing careers or finding more work—it can begin with fostering a sense of stability by simply knowing where you stand, and where you want to go.

Feeling in Control of Your Finances

Do you wake up each morning checking your balance—or avoid looking for days out of fear?

Even though it might feel stress-inducing, knowing where you stand is a crucial part of financial wellness. Understanding how much money is coming in and going out gives you the awareness you need to make informed decisions. Over time, those decisions turn into habits. By changing small behaviors—like choosing to make coffee at home—you begin to align more closely with your version of financial wellness.

Being financially well isn’t just about having large numbers in your account—it’s about being confident with your money. It means knowing what bills are coming up, when your direct deposit hits, and how to plan accordingly. With a clearer understanding of your income, expenses, and goals, you’re less likely to feel overwhelmed.

Fan and Ryu’s research also emphasized that a key factor in financial worry is a lack of confidence in financial decision-making.¹ Feeling financially well starts with being able to make confident choices—no matter how big or small.

Gaining financial control isn't just about tracking numbers in a spreadsheet. It’s about building a sense of peace of mind.

💡 For tips on staying on top of your money, check out our blog on #SpendingSavvy.

Stability Through Financial Security

The ability to meet your basic needs without constantly worrying about money provides a deep sense of stability. When you know you can cover essentials like housing, food, and healthcare, you’re able to focus on other parts of life—like building relationships, pursuing hobbies, or nurturing your personal growth.

When our financial worries are minimized, we’re better equipped to engage in self-care practices that support our mental health. This may include regular exercise, mindfulness, or seeking therapy—activities that become more accessible when financial stress is alleviated.

Achieving Balance

For those committed to improving both financial and mental health, achieving balance is key. It involves recognizing the connection between these two facets of well-being and taking proactive steps to nurture both simultaneously.

1. Start by setting realistic financial goals and creating a budget that aligns with your values and priorities. For more tips on setting aligned financial goals, check out our blog on #SavingYourWay.

2. Prioritize mental health by incorporating stress-reducing practices into your daily routine like screen breaks, walks outdoors, and conversations with neighbors or friends. Curious about skillfully discussing money with your loved ones? Check out our blog on #TalkingOpenly.

Remember, financial wellness is not just about accumulating wealth; it's about creating a life where your financial and mental health work in harmony. By understanding and nurturing the connection between financial health and mental health, you can live a more balanced, fulfilling life.

¹ Fan, Lu, and Soomin Ryu. “The Relationship Between Financial Worries and Psychological Distress Among U.S. Adults.” Preventing Chronic Disease, vol. 19, 2022, E08. Centers for Disease Control and Prevention, https://doi.org/10.5888/pcd19.210296.

Percapita does not provide financial advice. This material is for informational and discussion purposes only and should not be relied upon as financial guidance. Consult a financial professional regarding your specific financial situation.