The feel-good benefits of saving money in the bank
For some, nothing beats the rush of buying a snazzy new outfit or the latest gadget. While spending money on the things you love can make you feel good in the short term, did you know that saving money can make you feel just as super?
Aside from the obvious financial benefits, saving money can have a long-term effect on your happiness and mental wellbeing. Now that's something to really smile about!
We chatted with one of Australia's leading financial therapists Jane Monica-Jones about the “other” benefits of saving. Jane specialises in helping people reach their financial goals, while building resilience and creating smart money habits along the way.
"We all know that having savings is great for us financially, but did you know that saving money delivers many other non-financial benefits such as building self-confidence, protecting you against financial shock, and setting yourself up for a better retirement?" explains Jane.
Here are some of the feel-good benefits of saving:
Saving money can boost your confidence and cheer you up just just as much as spending it.
Jane agrees that treating yourself to a shopping spree can be fun, "but the regular practice of saving money helps build the self-esteem and self-belief needed to feel in control of your financial future."
"Studies show that people with savings have a more optimistic outlook."
Tip: If you're tempted to dip into your savings, The Vault can help by removing the temptation. This smart little tool puts your savings account out of sight in online banking, while still keeping it accessible in an emergency.
Reduces anxiety and protects against financial shock
Life has an uncanny knack of throwing us a few curveballs every now and then. And when it does, it tends to come with a hefty bill – think unplanned pregnancy, job loss, car repairs, etc... However, transferring a little money each week into an emergency fund will not only help you soften the financial blow, it can help you keep calm and reduce anxiety.
Knowing that you have some money set aside for a rainy day will also let you stay focused on the “big stuff” in life.
Hones your goal attainment muscles
Building your savings muscles is a bit like working out at the gym. The best way to reach a fitness goal is to start off with small, but consistent actions – going too hard, too soon can be painful. Ouch!
When working towards a savings goal, it's the little efforts that add up. Setting up a scheduled transfer each payday – even a small amount – will help you get that new car, holiday, or home deposit in the end. Plus, watching your account balance grow will help you keep your eyes on your goal and stop you from giving up too soon.
Just like the gym, there'll be days when you don't want to do it, but remember that feeling of accomplishment you get after a workout? Saving money works exactly like that too.
Sets you up for a better retirement
Retirement may seem a long way off, but developing good savings habits early is a great way to set yourself up for living well long after your working years are over.
"Saving money is the first step towards asset accumulation and building wealth for retirement, when you're no longer earning a regular income," says Monica.
Most people don't like to think about growing old. However, if you were to get really sick, having a financial safety net may help reduce the financial shock.
Likewise, if you live to be an active 90-year-old, having a healthy amount of savings will help you fund all the fun things in life.
Jane sums it all up by saying that "Getting started isn't too hard, but knowing that the benefits of saving are more than just financial can help you build the momentum needed to keep going."
Starting your own saving journey can be as simple as opening a new savings account that helps you save.