How professional financial advice could help boost your emotional wellbeing

Prince William founded the Heads Together campaign, back in 2016, becoming one of the first prominent figures to champion the mental health cause. Since then, famous faces such as Ryan Reynolds and Prince Harry have openly shared their mental health battles.

The state of the nation’s mental health and emotional wellbeing continues to receive attention and the coronavirus pandemic has brought the topic into sharp focus.

According to the Guardian, up to 3 million people in the UK who have fallen behind on bills are experiencing mental health problems[1]. Add in the fact that the economy is suffering to the tune of £118 billion a year and it’s no surprise that the topic of emotional wellbeing is in the spotlight [2].

If you’re feeling the pressure, getting your finances in order by seeking professional advice could be one of the best ways to improve your emotional wellbeing. Read on to find out why.

Report finds strong connection between financial advice and emotional wellbeing

The good news is that building your financial knowledge could give your emotional wellbeing a much-needed boost.

A recent report from insurer Royal London has revealed that regular professional financial advice doesn’t just deliver practical help and support[3]. It could also help to improve your emotional wellbeing by increasing your confidence in managing money and building a sense of control.

The survey found that 68% of customers who received advice from an independent financial adviser felt “in control of their finances” compared to 53% of those who had never consulted an adviser.

The importance of financial wellbeing

“Financial wellbeing” is about feeling in control of your finances and how managing your money can help you to enjoy life.

You probably have a good level of financial wellbeing if you:

•  Feel in control of your spending
•  Have realistic plans for meeting financial goals
•  Feel confident about coping with unexpected expenses
•  Can make the choices that give you an enjoyable life.

Without a strong foundation of financial wellbeing, you may fall into debt which, left unchecked, could lead to considerable hardship. This could result in lower productivity at work, poor mental and physical health, relationship troubles, and your overall life satisfaction is likely to be lower[4].

Financial advice for better emotional wellbeing

One of the biggest financial pitfalls people fall into, especially in the approach to Black Friday and Christmas, is impulse buying and overspending.

A survey by Which? revealed that many people regret their Black Friday purchases, with DIY products and home appliances topping the list of the most regretted purchases[5]. 

Being more mindful about where your money goes could reduce the stress caused by making regrettable decisions and overcommitting financially. Below are four tips to help improve your financial wellbeing.

Make a budget and stick to it

Budgeting may not feel exciting but being in control of your finances could help you to feel healthier and happier.

Before hitting the shops (online or in person), carefully assess your income and expenditure. Work out how much you can afford to spend and set this as a limit. It’s much easier to avoid impulse buys and emotional spending when you have a clear budget and know how much you can comfortably afford to spend.

Don’t be too strict with yourself, though. It’s important to plan for some “fun” spending as this makes it more likely you’ll stick to your budget. You might be surprised by how rewarding it can be to feel in control and confident about your finances.

Prioritise clearing debt

Problem debt can have a significant impact on your mental health. If you can’t afford to make repayments, this is “problem debt”. Almost half of people (46%) in problem debt also have mental health issues[6].

Debt can rapidly grow out of hand as the amount you owe will rarely remain static. There will be interest to pay on the original borrowing amount. There may also be compound interest due, that is, interest on the interest. In this way, debt can rapidly spiral out of control and become unmanageable.

Clearing your debt is one of the best ways to start rebuilding your financial and emotional wellbeing.

If you’re struggling with debt, a professional adviser can work with you to create a feasible plan for taking back control of your debt.

Set savings goals

You’ll quickly lose the motivation to stick to your budget if there is no end in sight.

Setting short-, medium-, and long-term savings goals could help to keep you on track. Setting milestones to celebrate wins along the way is also a good idea.

Keep your savings goals at the forefront of your mind to help you gain as much pleasure from saving as you do from spending. Stick a picture of your dream car to the fridge or download an app on your phone to check off mini savings goals.

You could also set up automatic savings so that a fixed sum is transferred to your savings account on pay day, removing the temptation to spend altogether.

Don’t forget to save for emergencies, too. This will give you the peace of mind that you can cope with unexpected expenses, and it will minimise stress if such events do arise.

Distinguish between “needs” and “wants”

Before going on a spending spree think carefully about what you need and what you want. Figure out what you can afford to spend on your “wants” after you’ve allocated budget to your “needs”.

It’s also a good idea to give yourself a “cooling off” period after seeing something you’re tempted to buy. Ask yourself:

•  Do I really need it?
•  Can I afford it?
•  Might I be able to find a better deal elsewhere?
•  What value does it add to my life?

Often, we’re tempted to snap up a bargain just because it’s cheap, only to later regret the purchase.

Keeping on top of your finances can be overwhelming and it’s easy to let money slip out of your control. Professional financial advice could help to put you back in the driving seat and could give your emotional wellbeing a major boost.

Get in touch

If financial worries are affecting your emotional wellbeing, please get in touch to find out how we can help and support you.

Email info@aspirafp.co.uk or call us on 0800 048 0150.

Please note

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

[1] https://www.theguardian.com/society/2023/jul/18/uk-people-behind-on-bills-mental-health-problems-study

[2] https://www.lse.ac.uk/News/Latest-news-from-LSE/2022/c-Mar-22/Mental-health-problems-cost-UK-economy-at-least-118-billion-a-year-new-research

[3] https://adviser.royallondon.com/globalassets/docs/adviser/misc/brp8pd0008-feeling-the-benefit-of-financial-advice-adviser-report.pdf

[4] https://www.forbes.com/sites/lizfrazierpeck/2022/01/19/financial-wellness-is-critical-to-your-overall-healthand-financial-literacy-is-the-key/?sh=2d3ae91d2cdc

[5] https://press.which.co.uk/whichpressreleases/black-friday-shoppers-rushed-into-purchases-they-later-regret-which-research-reveals/

[6] https://www.moneyandmentalhealth.org/wp-content/uploads/2019/03/debt-and-mental-health-policy-note.pdf