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How resilience can help improve your financial life

By practicing key resilience strategies, we can overcome those adversities to survive and prosper financially

  • REDACCIÓN
  • 31/07/2020
  • 16:58 hrs
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How resilience can help improve your financial life
According to the latest research by Financial Finesse, the pandemic has adverse effects on virtually everyone's financial health. (Photo: Pixabay)

By practicing key resilience strategies, we can overcome those adversities to survive and prosper both in our personal and financial lives.

Life is full of obstacles and adversities: some big, some small, and others like the pandemic have affected every facet of our lives.

According to the latest research by Financial Finesse, the pandemic has adverse effects on virtually everyone's financial health, leading to increased stress and decreased economic well-being worldwide. As a result, we need to take care of our finances and, most importantly, our mindset towards money.

According to Karen Reivich, one of the leading psychologists in this field of study, resilience is the ability to recover from adversity and grow from challenges. Research has shown how cultivating and practicing resilience can help you overcome obstacles and enable you to prosper and live a fuller and happier life.

Remember your ABC

ABCs refer to the mental connection between experiencing adversity, the set of beliefs you have around that adversity, and the emotional and behavioral consequences of those beliefs.

The bottom line is that by challenging beliefs around specific adversities, you can change how you feel and behave in the face of them, which can lead to better decision making and results.

Here are three practical strategies to help challenge beliefs about adversity you are facing to help overcome it:

1) Use evidence or discrete data to question your belief.

2) Reframe how you see a situation. For example: "A more useful way to see this is" or "A better way to see this is."

3) Plan: "If x happens, I will y." Sometimes we can feel that we are not good with money, so when we face a financial challenge, we tend to withdraw and hope that it will disappear or that someone else will take care of us. That's why Forbes expert recommends using the alphabet to challenge that belief.

(Photo: Pixabay)

Maybe you can rephrase that thought and say, "I don't know much about money, but I can and will learn." Taking that growth mindset can help you overcome initial stress and the tendency to withdraw to face that challenge head-on. You can also use that strategy to improve your budget by planning, deciding that you will try another if one budget approach doesn't work. For example, some people like to budget with pencil and paper, others like spreadsheets, and others use software programs.

Take advantage of optimism.

Being optimistic is believing in a positive future, being focus oriented, seeing problems as a challenge, not a threat, and having the ability to identify what can and cannot be controlled. Take advantage of optimism to plan and save for retirement or other long-term goals. If you tend to avoid planning for the future, practice optimism to focus, and envision a positive future, and thus recognize what you need to do to get there and challenge yourself to increase savings.

Practice gratitude

People who cultivate gratitude in their lives have better mental and physical health, have a more exceptional ability to solve problems, and experience satisfaction. You can try writing at least three things a day and reflect on why you are grateful for those things. Apply this to your finances. Recognizing what you have and how they make you happy will help control spending and increase savings. This approach can help you rule out instant gratification and encourage you to save for big purchases instead of immediately taking out your credit card. Practicing gratitude helps cultivate satisfaction, which can help you decouple the feelings of happiness from buying more or having more money. Experiencing joy can increase the likelihood of saving money for long-term goals that will help you feel more satisfied and avoid impulsive purchases that can break your budget.

Traducción: Valentina K. Yanes