Financial well-being depends on many factors: how much you earn, whether you can live the way you want, what kind of pension you will receive. But according to a recent study by a well-known investment management company in the United States, saving seems to directly affect our stress levels and our overall well-being. How much money we keep aside makes us feel good?
Specifically, participants who had at least $2,000 saved reported a level of financial well-being that was 21% higher compared to those who had no savings for emergencies at all.
The “safety cushion” for peace of mind
The survey, which surveyed more than 12,000 investors, found that those who had at least $2,000 in emergency savings spent less time each week dealing with their finances: just 3.7 hours on average, compared to 7.3 hours for those who had no savings at all.
“Emergency savings buy peace of mind and create a safety net in case something goes wrong.”
The study also found that 51% of people with no savings at all experienced increased financial stress over the course of a year.
How much money should you have saved?
Experts recommend having three to six months of basic expenses in savings. However, this recommendation may seem difficult for someone living paycheck to paycheck.
You don’t need to have a high income to feel more secure, economists say. All you need to do is start consistently. A small amount each month – even 10 or 20 euros – can slowly help you regain control.
Financial well-being is not just numbers in your bank account. It’s how calm you feel, how well you can focus on your work, and ultimately, how free you feel to live your life without the constant fear of “what if something unexpected happens.”
Saving to live better and longer
Saving is not only good for our bank account, it can even extend our lives, highlights a study published in the scientific journal PLOS ONE (“Living on low-incomes with multiple long-term health conditions: A new method to explore the complex interaction between finance and health“).
Specifically, the research team observed that people who were proactive about their future had better health and a lower risk of death, regardless of other potential influencing factors that may affect financial strategy, such as demographics and income.
These findings suggest that long-term planning may be particularly beneficial for the health of people who do not have financial safety nets for unexpected expenses, the research team reports.
There is no shortage of research that warns that, when financial stress becomes intense, your health “pays” a heavy price.
Researchers at University College London point out that people who face financial difficulties and experience chronic financial stress are more likely to develop serious health problems.
According to their study published (“Financial stress linked to worse biological health“) in the academic journal Brain, Behavior, and Immunity, participants who reported financial stress – that is, the perception that they may not have enough financial resources to meet their future needs – were 59% more likely to develop a wide range of mental and physical illnesses, from cardiovascular disease to depression .
