Four Behaviours of Low Financial Stress
Generally, most stuff that is written is, for lack of a better word, bull. This is not to say that the stuff is not interesting, but it just might not be true. If you want the facts, you need to find a peer reviewed journal article.
Most financial writing is opinion, not fact. This is a problem when you’re recommending actions to clients. Should they try debt consolidation? Payment Arrangements? Debt Agreements? However, there is some good research emerging on consumer finance and financial counselling.
One excellent study looked at “behaviours” in financial counselling clients and found that there were four “behaviours” associated with having low financial stress (Jing Jian Xiao, Benoit Sorhaindo, E. Thomas Garman, 2005, “Financial behaviours of consumers in credit counselling”). The researchers generally found that clients with lower stress tend to:
- Make plans on how to use their money
- Write down how money is spent
- Evaluate their spending on a regular basis
- Use a written budget
A recent Wesly Mission Report found that financial stress is associated with “adverse relationships with your spouse”, “problems with family members” and “the inability to think clearly”. Their research had several financial indicators that were associated with significant adverse effects on family relations.
- Being unable to take a one-week annual holiday away from home
- Inability to afford a night out once per month
- Inability to pay a utility bill on-time
- Seeking financial assistance from family or friends
If you have experienced any one of these indicators or if you’re experiencing financial stress, maybe it’s time to try these behaviours. In the coming weeks, I’m going to work on implementing these behaviours myself. I’m going to record my expenses, evaluate my spending, make plans on how to use my money and use a written budget. It’s called the Financial Freedome Journey and it’s about to kick off!