Today, an increasing number of people face challenges with their mental wellbeing, making a national debate on the importance of supporting good mental health all the more salient. There are countless contributors to mental health problems, and for many, an overwhelming sense of anxiety about their finances tops the bill.
Figures from Scottish Widows’s recent Mindful Retirement study found that almost half of Brits say financial worries regularly impact their personal relationships, and affect their ability to sleep. Worryingly, figures from the same study show that almost a third of us feel stressed merely thinking about our financial situation in retirement, and yet, only 56 per cent of us are saving enough to do so comfortably.
Surely, it is time to consider how we can help manage money worries, and ultimately reduce stress and anxiety.
As part of the Mindful Retirement study, we designed a unique experiment that would enable us to observe and monitor the reactions of a group of men and women aged between 35 and 45 from across the UK, as they were faced with the realities of retirement. The group watched films illustrating two opposing situations; the first depicted a rosy picture of retirement, while the second emphasised potential financial hardship in later life.
All the participants were fitted with oximeters (to measure their pulse rates) and we monitored signs of relaxation and stress, including facial movements and body language. We then asked the group to share their feelings: would the videos make them revisit their retirement plans?
More than three quarters of those who took part said that the hardship film caused them concern about their own financial prospects later in life. But it took just 3.5 minutes of footage to prompt most participants into action. Nine out of 10 said they would review how much they are saving towards retirement. On average, watching the video resulted in participants pledging to increase their monthly pension contributions by an average of between 2-5 per cent.
The group’s reaction suggests that, prior to taking part in our experiment, the majority of participants had given little or no consideration to the financial impact of their retirement. Instead, it took the visual reality of the film to create a fear that it could come to personal fruition unless they acted to do something about it.
What is important for the group we monitored – and for many others in fact – is to consider how, and when, action can be taken without waiting for “the fear” to kick in. As far as retirement is concerned, all too often people delay saving, or put off thinking about it, simply because it feels so distant. This delay, in turn, creates a false sense of security which can often prevent them from acting.
The purpose of putting money away for retirement can feel too abstract and unreal in younger life, but we can’t afford to ignore it. Try to focus on what your ideal retirement looks like; knowing what you want out of it, and how much money you will need to set aside to cover it, can be a huge help.
Burying your head in the sand will only cause pain down the line. Simple steps like reviewing your current in and out-goings are a good start: is there any room to put more money away for the future? Why not use any pay rises or bonuses as a trigger to increase contributions to your pension savings? By taking control it will alleviate pressure on your mental wellbeing both now, and more importantly, later in life.