Even with the best budget, everyone can experience a little financial stress from time to time. But ongoing stress can be detrimental to your state of being. Can awareness reduce stress and build a better financial plan? The answer is encouraging and a bit surprising: yes.
How can awareness help you manage your finances?
Areas of the brain associated with distraction, stress and anxiety become less active, with mindful awareness. In addition, those associated with cognitive control and optimism are stimulated.
This means that practicing mindfulness can help you:
- Ease anxiety.
- Reduce stress.
- Make better decisions – and stick to them.
That’s what cognitive control does. When you’re optimistic, you can approach problems more confidently and calmly. With money being considered a source of anxiety and stress, awareness can relieve you from financial stress. It will make it easier for you to make wise spending decisions, save, and invest and act on them, thereby putting you in control of difficult situations.
If you’re new to financial awareness, it’s not just a change in attitude. It’s a skill you can learn and develop. Thanks to the brain flexibility, this skill can be learned even if it is not innate.
In other words, by consciously giving your attention to something, the more attention you find you can give.
It is a gradual change. The more you practice, the better you get, and it’s worth the effort because you gain greater insight and focus. To be financially aware, you need to constantly ask yourself
- How do you manage your finances mindfully?
- How do you spend your money mindfully?
How do you tell them apart? To make a conscious financial decision, you need to be sure of two things:
- Why you are making that decision.
- How that decision aligns with your core values and aspirations.
This thought process also applies when you set a budget. You stick to that budget by saving and spending within its limits.
Before making a purchase, ask yourself these three questions:
- How long will this purchase give me satisfaction?
- Does it help me stay on track with my short- and long-term goals?
- Why exactly am I making this purchase?
You can apply similar principles to your budgeting. When trying to save money or have new obligations, ask yourself these same questions.
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