Why financial planning plays a major role in maintaining your mental health

 Why financial planning plays a major role in maintaining your mental health

What is a financial plan?

Financial planning is a step-by-step process to achieve your life goals by effectively managing your money. A financial plan acts as a road map as you travel for the rest of your life.

It essentially helps you maintain control over your income, expenses and investments so that you can manage your finances and reach your goals.

Financial planning is extremely important for every person, be it a man or a woman. It is a little more important for women to know their own way about money and learn to save, invest and spend it wisely.

How does it play a major role in maintaining your mental health?

Financial problems are one of the major reasons for stress or mental health issues for a person. The quality of life of a person completely depends on the money decisions taken by him.

So it is wise to make wise decisions regarding your hard earned money and don't let this important aspect ruin your mental peace and health.

Financial planning, wealth management and investing have traditionally been male-dominated and male-oriented. Women are not actively encouraged to manage money as the ecosystem has primarily targeted men.

Hence, a step towards learning and handling their money can bring a lot of clarity and positivity in their lives. It also boosts confidence and provides mental peace.

Women are natural wealth managers. Women can go from managing household budgets to smart investors when equipped with the right qualities to make risk-aware, disciplined, informed decisions and stay calm under stress.

What can you do to lead a stress free life?

Effective money management reduces stress, anxiety and insecurities, which then allow you to enjoy every moment of your life.

1) Create a budget so you don't make impulsive purchases.

2) Save regularly to avoid paycheck to living paycheck.

3) Try to have more than one source of income: Multiple sources of income save you from financial crisis as well as provide a stream of funds for investment.

4) Having a proper understanding of where your money is going and gaining knowledge of the financial instruments in your portfolio will help you assess risk and reward scenarios. This will help you avoid unwanted risks and have a peaceful sleep.

5) Set financial goals and start investing.

6) Build an emergency fund to have a cushion to protect yourself and your family from any contingencies. This can be equal to 6-8 months of your monthly expenses.

7) Build a Retirement Fund: Your expenses will continue but your income will stop, so you will need a good financial support to sustain you through your dream retirement and ensure that you stay on track during your retirement years. living independently.

8) Manage your loans effectively, and avail loans as per your ability.

9) Prioritize Health and Term Insurance: Uncertainties do not knock at the door, they are sudden and rather disruptive- emotionally and financially! Our study states that 58% of women have no health or life insurance in their name. So cover yourself and your loved ones with health and life insurance to ensure your family's financial stability!

10) If managing money seems overwhelming in the first place, talk with fellow ladies, take guidance from experts and take small steps. But the most important thing is to start the journey so that you can become accustomed to managing it.

11) Financial planning is a family strategy: Have periodic meetings with your family to discuss financial matters so that everyone is informed and there is no tension when needed.

Good Financial Health Leads to Good Mental Health!