Here’s How Gratitude Can Help Your Finances
Learn How Your Mindset Can Improve the Way You Manage Your Money
The term “money mindset” is most often used in discussions about attracting greater wealth in your life. However, there’s an alternative way to look at this phrase, too. What if, instead of focusing on trying to bring more money your way, you flipped your mindset to one of gratitude for what you already have?
Believe it or not, waking up each day focused on practicing an attitude of gratitude can actually enhance your finances over the long-term. Read on to learn three important reasons that being grateful can improve the way you manage your money.
Financial Patience is a Virtue
Research published by the Association of Psychological Science shows that feelings of gratitude can help us overcome the impatience that often leads to imprudent purchases. Participants who demonstrated higher levels of gratitude were more likely to choose to receive $80 in 30 days, rather than $54 in the moment. According to the study’s authors, this means that cultivating feelings of gratitude can combat a tendency toward instant gratification. In this way, being grateful can reduce impulse buying and insufficient savings.
Why is this? Well, as you practice gratitude and begin to feel more fulfilled by what you already have in your life, you will be less likely to seek out the thrill you get from spending money. This is a meaningful change for many people, given that five in six Americans admit to impulse buying. If the simple act of practicing gratitude can prevent you from spending an extra $100 here and there, your finances will be healthier for it. If you begin putting money from those would-be impulse buys aside and use them to create a savings plan instead, you’ll be even better off in the end.
Gratitude Promotes Generosity
This might sound counterintuitive, given that the above research shows how being grateful saves you money. However, brain research cited in Greater Good Magazine shows that gratitude also makes us more likely to give to others.
If you’re wondering how this will improve your finances, it boils down to this: people who give back tend to be clear about their money priorities, and they are also more likely to track their spending. Both of these traits help you to better manage your finances, meaning you’re also more likely to meet your financial goals. As a bonus, charitable giving also provides a tax break.
Cultivate Your Contentment
When you live life with an attitude of gratitude, you’re likely to feel more content with what you have and where you are in life. Contentment is a great way to avoid the challenges of “hedonic adaptation.” A term coined by social scientists and positive psychologists, it refers to the tendency to revert to a particular level of happiness regardless of what may come your way. An example is when a lottery winner’s expectations about life adapt to their new and improved circumstances, meaning their newfound riches might provide a burst of joy and excitement at first but then quickly become a “new normal” that leads to the same overall level of contentment – or discontent – they felt before winning the lottery.
Think about your own circumstances. Have you ever gotten a big raise, only to realize the excitement is short-lived because you quickly adapt your life to your new level of income and then still find yourself wishing you had more money? If you focus on gratitude and contentment, however, you can find more long-term happiness and protect yourself from the woes of hedonic adaptation.
If earning more money and spending more money aren’t the ways to achieve true happiness – or, necessarily, financial security – maybe it’s time to change your money mindset to one of gratitude. Adopting a grateful attitude will help you overcome impulse buying, cultivate a sense of contentment and save you from continually chasing things that won’t help you achieve true happiness or financial security in the long run. Instead, using the power of your attitude of gratitude, you’ll be on your way to healthier finances and a more fulfilling life.
About the Author
Carroll W. “Bill” Hayes, MBA, CFP® Mr. Hayes started his financial career at Merrill Lynch in 1989. In 1992, Bill left Merrill Lynch for Fidelity Investments. During his career at Fidelity Investments he held roles in various divisions of Fidelity. Those roles included positions in the Trust, 401(k), Brokerage, and Money Management divisions. Bill held management positions at Fidelity and in 2001 led a Private Access team based in Boston. In the Private Access role his responsibilities included managing a book of business in excess of $3 Billion and a client base that was international in scope.
In 2008 Bill established Charles Carroll Financial Partners. The firm is an Independent FeeOnly Financial Planning and Investment Management firm. Charles Carroll Financial Partners embraces its fiduciary responsibility to its clients.
Bill is a graduate of Marquette University, and holds an MBA from the Sawyer School of Management. Bill holds the designation, CERTIFIED FINANCIAL PLANNER, and currently presides as a Commissioner on the Disciplinary and Ethics Commission of the Certified Financial Planner Board of Standards. Bill resides in Massachusetts with his wife Christine and travels up and down the East Coast meeting with clients of the firm.