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Saving makes you smile

Category financial-health-barometer managing-your-money personal-finance savings

Saving makes you smile 

Earlier this year, we surveyed a thousand Kiwis, hoping to reveal our nation's financial ambitions, and open the door to a conversation on how New Zealand spends and saves.

One aspect we were particularly interested in investigating was the influence that financial stability can have on people's emotional wellbeing.

While it's widely accepted that money can't buy happiness, our survey showed just how easily our financial situation can affect our emotions, our relationships, and even our sleep.

Financial control and happiness
Hamish McKegg, Head of RaboDirect NZ, says one of the most important insights he takes from the survey is the intrinsic link between financial control and happiness.

"Sensible management of personal finances contributes to increased levels of happiness", says Hamish. "The survey showed those regularly contributing to their personal savings were more likely to report feeling happy with their lives than those who weren't."

Survey respondents with regular control of their finances through savings plans and budgets were found to be the happiest overall, with close to half of that group saying they felt completely happy with their lives. That figure dropped to just over a third for those not making regular personal savings contributions.

Money worries
Additionally, when there is a lack of a structure or plan around how we spend money, feelings of guilt and stress can build up over time. Of those we surveyed, one in five said their money worries had kept them up at night, while another half said their financial situation had caused tensions within their household.

The survey also shows that a fifth of New Zealanders don't have any existing savings to live off should they suddenly lose their job, which Hamish points out would have an emotional toll.

"Living with that knowledge at the back of your mind can create a tremendous amount of financial stress, which in turn could have a detrimental impact on emotional wellbeing" he says.

"Many people already realise that a greater understanding of their financial incomings and outgoings, be it through creating a budget, a regular savings plan, or by other means, reduces financial strain."

Optimism for the future
Despite many respondents indicating that they were experiencing at least some financial pressure, many were also optimistic, and 56% of all those who were surveyed said they felt excited about the future.

Hamish thinks that percentage would be even higher if people were to look more closely at ways in which they could gain better control over their finances.

"The good news is that many Kiwis only need to make small changes to their behavior to put them on a better savings path."


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