School days – the best days of your life?
I recently heard a friend having a fascinating conversation with his teenage children about when is the best time of life. The teenagers were convinced that their father is in the best era – he is a qualified professional with a career and in their eyes he has the independence and freedom to make his own decisions that best suit him. The father was convinced that his children are in a position to have the best time during their school years. Granted there is the pressure of school and exams and they have to take into consideration their parents’ requests/demands, but in his opinion they have limited responsibility outside of their school studies, and everything in their home life is set up for their taking, benefit and enjoyment.
I found two elements of this conversation really interesting. The first is how we are generally wired to see things from our perspective and often have a hard time seeing the other side. But the second element was how both my friend and his children acknowledged that their lives were very stressful. And although neither one fully appreciated the stress the other was experiencing, the negative connotations were clear!
Good stress vs bad stress
With all the negative press that stress gets, did you know that there is good stress too? Good stress is when you feel excited, motivated and pushed towards achieving. Healthy stress can push you to peak performance. Stress is a burst of energy, which floods the body with chemicals that help us meet challenges and deal with our tasks. That kind of stress can actually be beneficial to our wellbeing, and we should try to include it in our lives. So what differentiates good stress from bad stress? Basically, healthy stress is also known as acute stress or short-term stress – and that is the main difference. The length of the experience, and the amount of time between each occurrence, is what separates bad stress from healthy stress. Although being that humans are so different from one another, one person’s healthy stress may well be another person’s bad stress.
Financial stress – bad by everyone’s definition
Financial stress, on the other hand, is at the opposite end of the spectrum, and has very little or no positive benefits – it is generally long-term and constant, and is often the cause of major health and emotional issues. Which makes it all the more unfortunate that so many people suffer from financial stress and the negative side effects.
Financial stress is so detrimental because it can develop into an all-encompassing phenomenon, affecting all elements of your life. It affects your short-term decision-making of how you get through the month and how you make debt repayments. It affects your long-term stability and can impact your relationship with family and friends. And if you can’t completely remove financial stress, which most of us can’t – then you have to find ways of reducing it to improve your health and quality of life. And that is possible, and crucial.
The 10% Rule
The difference between financial health and financial dysfunction is 10%. If you spend 5% more than you earn rather than 5% less, you have a 10% difference. But if that pattern continues over months and years you are constantly creating debt, which accumulates. And that seemingly insignificant-sounding 5% drags you into a never-ending circle and cycle of increasing debt. You then start chasing your tail trying to find ways to make up money that you don’t have.
Instead of the above ‘constant failing to catch up’ scenario, try and spend consistently just 5% less than your income. And then watch that seemingly insignificant sum mount up slowly but steadily over the months and years, so that you are in a situation where you can make it through the months, where you will begin to have savings and money that can be put aside for special events, or unexpected expenses.
I’m in no way suggesting that it’s easy to cut back – even 5% – but it is manageable. Work through your budget and start by making that small step of reducing your expenses by 5%. And in addition to a healthier financial picture, you’ll find yourself in a healthier physical situation as your reduced stress levels will help you enjoy an improved quality of life.
Try it today, and maybe that will be start of the best days of your life!