You know the old adage: Money doesn’t buy you happiness. This certainly may be true in many aspects, but recent research tells us that overall health and happiness may have more to to do with your financial security than you think.
So, can money really buy happiness? Perhaps not, but saving and spending money wisely can make life less stress and add more joy to your life. Plus, if your healthy self is going to be living a long life, you’ll need the wealth to get you through retirement.
Blackrock’s recent report uncovers the connection between well-being and wealth, and we’re diving into it.
In Blackrock’s recent findings, 120 conversations around the world centered upon the connection between wealth and well-being.
The Up-Take: Investing leads to a greater sense of well-being. This was regardless of age, stage in life, or socioeconomic factors.
THE BIG CONNECTION
Healthy people take care of themselves. They eat well, exercise, and practice self-care. Taking care of your finances can have the same benefits. Often, taking care of health issues can be costly, and having the financial security to preventatively and reactively take care of oneself is SO important.
According to the American Psychology Association, “women report higher levels of stress about money than men.” Adding to this is the fact that 1 in 5 Americans say they have either considered skipping or skipped going to the doctor in the last year…because of financial concerns.” The connection between financial security and overall well-being stems from taking control of your life in one way, and gaining confidence in the process.
THE BARRIERS TO INVESTING
Despite findings that 43% of people that invest feel more optimistic about their futures, Blackrock found that 57% of people are NOT investing money into stocks or bonds. Some of the cited reasons included being “more interested in achieving short-term goals” and “afraid of losing it all.” People also had the common sentiment of feeling that investing is for the experts, and too overwhelming to get started with.
More than half of the non-investors questioned found information about investing difficult to understand, and 54% were under the assumption they did not have enough money to even get started.
THE WAY FORWARD
Not sure how much to invest? The 50/30/20 rule is a great one — and if you’re not there yet, it’s one to aim for.This is the inequality we can start working on all by ourselves. With that in mind, Blackrock put together 4 steps that lead to financial well-being.
1. “Make a little go a long way.”
It’s possible (and smart) to invest even small amounts of money. Many people start off investing this way, a little at a time, and financial firms understand this. That’s why Ellevest has given Style Salute readers a $25 toward your first funded goal if they start investing today.
There’s a common misperception that in order to invest, you need to first be rich. That’s not true. You can open an account with with Ellevest for $0 — you won’t earn anything, but you can at least open the account. With as little as $1, you can start investing in exchange traded funds, or ETFs.
2.”Find a good teacher.”
Working with a financial advisor you trust is important for reaching your long-term goals.
3. “Balance the short-term and long-term.”
It’s important to keep in mind all goals when starting to invest. Building your wealth for retirement is important, but so are your short-term goals, whatever they may look like for you.
4. “Don’t wait too long.”
Planning for your future by investing your money shouldn’t be put off till tomorrow. It’s one of the most important things you can do for yourself. When you invest your hard-earned dollars can grow faster than if you were to keep it in cash or a savings account.
The sooner you start investing (even small amounts) the longer your money has to grow.
Of course, markets can be volatile but research shows that over the long-run staying in the markets will help your money grow. A lot more so than keeping it in cash.
To learn how to get started investing for women go to Ellevest and get your free financial plan (a great way to see if you like it).