How to Boost Your Mood and Money

• One false theory regarding money is that an abundance of it is needed to be happy.
• In reality, a large amount of money is not essential, but the money habits used to spend and invest money are. 
• Therefore, the better money habits one has, the more money they can retain, which will improve their financial status and mood.

One major misconception regarding the correlation between money and happiness is that a large sum of money must be content. However, even if you aren’t making six figures and satisfying all of your wants, you can still live a comfortable life if your finances are managed appropriately. 

Common Money Mistakes

Typically, some people are unhappy with their current financial status because they possess poor financial habits. Thus, making poor decisions related to money can hinder one’s financial position. Here are some common mistakes people make when managing money.

Unused Subscriptions

One poor decision that people have made is not canceling unused subscriptions. These subscriptions are typically paid, yet the services are not being used. Consequently, paying for unused subscriptions could lead to eventual financial hardship. Therefore, it is important to consistently check your bank account and ensure all expenses are for needed items.

Making Impulsive Financial Decisions

Another irresponsible financial decision is making impulsive decisions and purchasing unnecessary items or items that are too expensive. These types of recurring purchases negatively affect one’s financial position, and by extension, their mental health as they will be worrying about money and how they will pay their bills at the end of the month. 

One solution to combat this issue is implementing a seven-day rule when purchasing an item. The seven-day rule states thoroughly thinking about an item before buying it. By doing so, the chances of impulse buying decrease, allowing more money to be saved at the end of the month.

Maxing Out Credit Cards

The final issue some people make is maxing out their credit cards during their monthly purchases. Typically, it is recommended that only 30% of the total credit limit be used. However, once this 30% threshold is surpassed, financial institutions may believe the person is irresponsible with their money and may struggle with repaying a loan.

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Therefore, it is crucial to pay off your credit card regularly and on time.

Recommended Read: What is a Credit Profile and How Can I Repair My Credit?

How to Improve Your Financial Status

It has been well documented that your financial situation can directly impact your mental health and mood. Fortunately, there are different ways to help boost your mood and aid you in achieving your financial goals. Here are some ways to improve your financial status and mood. 

Check your Transactions Regularly

Sometimes we get a little too spend and swipe happy, resulting in expenses getting out of hand. A way to prevent this from happening and improve the mood about your current financial status is to record every transaction. 

The documentation of transactions helps you understand what expenses are needs and which ones are wants. Therefore, the differentiation will help remove unnecessary expenses and increase your monthly net income.

Generate Multiple Streams of Income

Active income can be made in many ways, such as tutoring, getting a second job, driving for Lyft/Uber, or turning your hobbies into a business; another income option is passive income. Passive income is one way to increase your income without actively working for the money you receive. In addition, increasing your income will help give you financial flexibility and financial security.

Separate Your Emotions From Your Money

Mixing emotions with money is a poor combination, destined for failure. It’s common for people to spend money based on their feelings depending on their current mood, leading to the mismanagement of their money. When your mood affects your thought process, it could lead to poor financial decisions as one can make impulsive decisions. 

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Impulsive spending can worsen your mood and ultimately cause a financial burden. Therefore, it’s essential to take time to separate your money from your feelings; doing so will help you prioritize your needs versus your wants.

Set Realistic Goals Regarding Your Financial Situation

It is hard to stay on track with your financial objectives without clear goals. Therefore, setting realistic goals and keeping track of your spending to see if your goals are being met is key to being financially happy. Use S.M.A.R.T. goals to help guide you through the process of goal-setting.

Treat Yourself

While you should financially prioritize your bills, your children’s needs, and other high-priority items, always remember to treat yourself in the process.

You work hard, so that means you also deserve to treat yourself. If you only save your money or spend it on others, you will not enjoy your hard-earned money. So whether it is big or small, it is essential to treat yourself accordingly every once in a while.

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It is essential to keep in mind that personal feelings are attached to your money. As a result, you could misuse funds which can hurt your finances in the long run. Therefore, following these tips above to boost your mood and think logically about your finances will increase your happiness overall while preparing for a future full of financial stability.

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