Money Smarts Blog
Mo' Money, Mo' Problems?
Jul 10, 2023 || Carly Carman, Financial Coach
Research says no.
The process of scientific discovery has always interested me … so when my world of finance collided with scientifically backed research saying money can buy happiness, you can bet I was all in.
To start, we need to go back to a 2018 study published in Nature Human Behavior journal, which found that income was linked to emotional well-being. More recently, a 2023 study between Princeton University’s Daniel Kahneman and University of Pennsylvania’s Matthew Killingsworth suggested that happiness does, in fact, improve with higher earnings (up to $500,000), giving us a threshold of how much money is considered “enough.”
Does that mean you have to make $500,000 per year to be happy? Nope. In fact, 90% of survey participants reported incomes below $200,000. But the correlation still exists. Think about it: The more money you have, the more control you tend to feel over other aspects of your life. Being financially comfortable helps ease the burden of medical bills, mortgages, schooling and more. (Let’s be honest, I’d be more than happy to have my house fully paid off and not have to worry about it anymore!)
PRO TIP: START GOOD HABITS EARLY WITH KIDS If you’re a parent, start teaching your kids early on about the benefits of saving. I was brought up by a single mom who taught me the value of money and saving before I even had a bank account. I’d save all the birthday and holiday money I got in an old jewelry box, creating early saving habits that have stuck with me through the years. Luckily, kids today have access to the Balance Builder Junior Savers a program designed especially for kids 17 and younger to help teach them about finances in a fun way they’ll understand.
Are you financially comfortable?
What’s “comfortable?” It looks different for everyone. Generally, if you’re able to stash some money away for retirement while paying off a mortgage, covering your basic needs and have some leftover to play with — chances are you’re in a pretty good financial spot.
On the flip side, if you’re consistently running out of money early in the month, you can’t seem to cover your bills and you’re always worried about your finances … it’s probably time to meet with a financial coach (and you shouldn’t wait until you’re desperate for cash — we’re here for you every step of your journey).
Too often, I meet with well-meaning members who just don’t know where their money’s going, or they’re unsure how to save or they don’t realize their earning potential. Spoiler alert: It’s my job to help you get back on the path toward financial independence! After all, you’ve worked hard for your money — now it’s time to make it work hard for you.
My mom would always tell me, “If I ask you how much is in your account right now, you should be able to tell me right then and there.” If you don’t know what’s in your account, or if you don’t have enough to be comfortable, I want you to know it’s okay to ask for help when you need it. I understand it can feel embarrassing or awkward because talking about financial struggles can be HARD. But you know what? We’ve all been there at one point or another".
Thinking about your situation as an obstacle course will help you find ways over/around/through the barriers and one step closer to reaching your financial best. And at IHMVCU, we’re dedicated to building relationships with our members and guiding you on the path toward reducing financial stress. Give us a call. We’re here to help.
