I was speaking with a friend last week about my ambitions to become financially independent. She’s a creative and hyper-intelligent sort but doesn’t care much for money. So as I set out my plans for financial independence enthusiastically, she listened carefully but I knew what was coming.
“You know, money isn’t everything,” she said. “You shouldn’t think about it so much. It’s not healthy.”
Unbeknown to her at this point, she had triggered what I call the ‘financial independence response mechanism’. I began to explain that money was just one part of it. That with the right plan for our money now we were actually prioritising an escape from that relentless focus when we became financially independent later. And that it wasn’t a journey of personal deprivation, rather a series of different decisions to alter the long-term course.
But as I immersed myself in this financial independence lecture, I’d lost my captive audience no sooner than I’d started. We inevitably drifted onto other things.
As I reflected on our conversation that same evening, something was troubling me. Maybe she had a point. Maybe I was thinking about money too much. And what had I actually said to address it, other than to spout out the usual stuff about financial independence?
I began to think more about what it means to think too much about something. I wondered at what point thinking becomes obsessing. And at what point that obsessing starts to jeopardise our own wellbeing, our relationships with others, and even our long-term ambitions – like, for instance, financial independence. It was a paradox I needed to get my head around.
Our Unhealthy Relationship with Money
There’s an intersection between money and mental wellbeing, and it’s not necessarily always positive. Excessive thinking about it can be insidious, consuming us from the inside. And this is especially the case if we’re not framing our reflections on our money positively.
Just take research from the American Psychological Association, who found that money was a top cause of stress in the US, with some 69 percent of their survey sample attributing their stress to money. And this isn’t just limited to the US. Research conducted by YouGov in the UK has found similarly troubling results on financial stress.
But perhaps what we consider less is that our financial stress has wider implications for our physical and cognitive health. A study by researchers from the University of Utah and Arizona State University demonstrated that financial stress can serve to exacerbate physical health conditions. And research based at Princeton University found that pressing financial worries and decisions affected low-income individuals’ performance on unrelated cognitive tasks.
What’s more, our financial worries can seep into our working lives and inhibit productivity. In 2017 Bank of America Merrill Lynch found that 2 out of 3 Millennials saw financial stress overtaking their ability to focus and be productive in the workplace. Similarly, a 2018 YouGov survey revealed that half of those surveyed with financial concerns believed they are less creative or less able to complete tasks that should be routine.
The research is clear: an undue negative focus on money can ebb away at our mental health, physical health, cognitive function, relationships, productivity and work performance. It can even therefore adversely impact the very thing we’re spending so much time thinking about: money.
Financial Independence and Wellbeing
So our financial worries can lead to an array of other associated problems. But our focus on money is perhaps even more pronounced in the midst of chasing our financial independence. We’re acutely aware of our financial health, more disposed to set challenging goals, and relentlessly focused on a future state. It will feel sacrificial at times, even if it isn’t.
What’s more, when we’ve focused so intently on achieving a goal, its fruition can feel like an anti-climax. Many successful early retirees have found themselves unprepared for their ‘freedom’, uncomfortable with the loss of camaraderie and the black hole that exists in life after their jobs.
But let’s not neglect the huge potential benefits for our wellbeing either. A more organised approach to our finances means we’re less likely to be stressed about pulling together enough cash to cover our costs from one month to another. And an earlier exit from work means we’ll have more time to look after our general health and wellbeing. So there’s also ample reason to be positive about the effects of pursuing financial independence for our wellbeing.
Finding the Balance
When it comes to how much time money spends in our heads, it’s therefore clear that finding the right balance is pivotal. When we develop excessive and repetitive thought patterns, psychologists call this rumination. And it’s at this point that we risk some of the damaging effects we’ve already talked about.
That’s why as I contemplated the answer to the title of this blog post, I considered what it really meant to be obsessed with something. Of course, I’m pursuing and writing about a personal finance journey, so money is inevitably going to be on my mind more than the average person. But it’s the point at which we develop a pattern of rumination that we should worry – and that’s why a balance is so important.
There are lots of things we can do to find that balance. It’s crucial to identify the things we can and can’t control, or else we risk expending mental energy for nothing. By planting ourselves in the present and being realistic about the future, we stand a far better chance of seeing through our goals, healthily and happily.
If, like me, you’re prone to thinking about things a little too much, it’s also important to find distractions in life. Occupying our minds with things that don’t pertain to money and bring us positive energy can have a profound impact on how much we enjoy the journey.
And there are many personal finance bloggers out there that also advocate psychological techniques, such as mindfulness and meditation. These techniques have proven evidentially effective in research and are designed to empty our minds of our worries, focusing solely on the present moment.
Painting a Fuller Picture
But what about my question? Am I obsessed with money?
Well, I’m thinking about it too much – of that I’m certain. And an excessive thought pattern has the potential to turn into rumination, which could then undermine my mental wellbeing and my long-term objectives. So I need to take action now.
What’s apparent is that the whole area of money can be a bit of a mental minefield. We’re all predisposed to obsess about things in one way or another. And the more we obsess and overegg the final prize, the more potentially difficult the reality at the end. So every Hustle Escape must therefore consider mental wellbeing and a breadth of other factors – or else what is the point?
The journey to early financial independence should be a happy and healthy one, and sometimes that requires a focus on other things. So that’s why I’ll broaden the scope of content on this blog beyond what I had originally intended. It will not just be about the financial principles of how to get there, but also about some psychological aspects of the journey and interconnected issues with our careers and mental wellbeing.
And I’ll practice what I preach. Whilst I intend for my content to help others on their personal finance journeys, I’ll apply it to my own journey too.
Life is too short not to pay attention to things that might undermine our health and happiness. When the evidence sings, we must listen – and then act.
