Financial fitness linked to better physical and mental health

The fitter you perceive your financial situation, the better your physical and mental health, according to a new study released by BT Financial Group (BTFG) today.

It found that lack of sleep, relationship problems and poor physical fitness go hand in hand with poor perception of financial health, whereas people with fewer financial worries fared better.

Amongst all people rating their personal financial situation as below average, 34 per cent considered themselves physically unfit compared to just 9 per cent of those in the top rating; 32 per cent said their relationships were affected by money worries compared to 14 per cent; and 38 per cent were unable to sleep because of financial troubles compared to 11 per cent.

“Financial worries can be a heavy burden on a person’s overall health and wellbeing,” said BT financial advice expert Bryan Ashenden.

“There are certain behaviours that those rating their personal financial situation low have in common – a greater tendency to spend more than they have, to not pay the total credit card balance and let large debts drift out beyond the interest free period. Very few are able to put money aside for an emergency let alone a retirement savings plan and just over a quarter (27 per cent) set any form of financial goal at all.

“But the flipside is that boosting your financial situation can reap rewards in other areas of your life. The key is to take control of your finances by setting budgets, reining in credit card use, avoiding the temptation to live beyond your means and creating financial goals along with a plan to achieve them.”

Mr Ashenden said the disparity was most marked when looking at levels of financial education.

“Only 22 per cent of those rating their personal financial situation as worst considered themselves financially educated as opposed to 68 per cent of those in the top category.

“You don’t need a university degree to become better educated about your finances. There is plenty of information available online, and for more detail, you can always talk to a financial adviser who can provide you with information on a range of topics, sometimes free-of-charge.”

To help kick start your financial fitness, BT has these top five tips: 

Your five-step financial workout

1. The pre-game planning Take a moment to consider your goals for the financial year ahead.Don’t be afraid to include wish list items but at the same time be honest about what may be affecting your financial health. It could be mounting credit card debt, an uncontrollable urge to shop or worry about your level of retirement savings.
2. The warm up Think about how you can reach these goals – draw up a budget that gives you a clearer picture of your incomings and outgoings. Having a budget and sticking to it is a discipline that will serve you well, preventing money leakage that can swallow your income. Speak to a financial adviser to help develop your short term and long term financial plan and develop realistic strategies to attain them.
3. The workout Put your plan into action! You’ll find that simply putting some time and energy into reviewing your financial situation gives you a greater feeling of control. Even better when you see the results, whether it’s reducing debt or achieving your savings goal.
4. The training Like any type of fitness, you need ongoing attention to your finances to make sure they stay in shape. If you find yourself veering off course, work hard to pull things back so that you stay on track to reach your goals. Financial fitness is about adopting healthy habits for life.
5. The stretch and recovery Take time to evaluate your progress, and reward yourself for the hard work you’ve put in. One success deserves another so if you’ve achieved the financial goal you set yourself, it may be time to set another.