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Why Financial Independence Matters For Your Mental Health

Maternal mental health financial stress

Money and mental health, are they even related? You bet. Your financial well-being can have a massive impact on how well you are doing mentally. In fact, finances have been found to be the #1 stressor for 73% of Americans (source). The younger the generation is, the more stressed they are about money. If you find yourself in the 73% of Americans with money as your top stressor, what can you do? Money is something we exchange for goods and services, if we perceive that we have too little of it, it can be stressful. We can also just be stressed about money because of our mindset and personal history. In order to find out how you can shift your relationship with money, I am going to use my story as an example of how a mindset can shift and how a humble life can be a happy life.

I was born to a working-class family in a rural part of Northern California. My mom had odd jobs and was an entrepreneur and my father worked for himself as an electrician. Money never appeared to be abundant, my parents seemed to be constantly stressed about money and struggled to pay their mortgage and other debts. By the time I was 16, my parents had filed for bankruptcy for the 2nd time and sold our family home. After couch surfing for a while with my parents while they searched for a place to live, I ended up moving in with a boyfriend and I never moved back home again. That was the start of my independent adult life. I had been working since I was 10 years and full-time since 14. I was attending a continuation high school so I could work long hours because I only had to go to school 1 hour per week. I thought it was a great deal. I had no idea what the purpose of saving money would be, I thought that was only for rich people who had tons of extra money. I had no idea what investing was, except for what my dad knew which was basically blowing your money on penny stocks and being sad when your money was gone.

I spent a while working, eventually going to Community College and then a local University. I took out loans, I thought that was just "what people did." And it never occurred to me to save up and pay cash or wait to go to a public university to save money. Nearing graduation from University, I snagged a job in my field (psychology) at an Eating Disorder Clinic. I eventually worked my way up to Intake Coordinator and I had many long days in the office. Sometimes there was a lot to do and sometimes, not so much. On the not-so-much days, I looked up random stuff on the internet. I applied to work in Human Rights in Rwanda. I looked up Vedanta, Hinduism. And I looked up what to do with extra money. Through my internet searches, I must have stumbled upon the FIRE movement or something similar. The FIRE movement stands for Financial Independence Retire Early. The FIRE movement is all about saving a lot of your income now, investing it somehow, and then living off of the returns at some point and not having to work if you don't want to. Watching my parents, who planned to "never retire" most likely because they hadn't saved a dime to retire, I was intrigued with having a different future.

I also became focused on purchasing a house. After my parents lost their house, I was adamant that I was going to be a property owner. I did find a below-market rate 1 bedroom condo in a really nice part of town and the stars aligned and I bought it! I continued to save all my extra money and invest it into index funds. It wasn't some huge amount of money but it was more than I'd ever saved and I felt rich. When I began to be unhappy with my job, I felt confident enough to quit and move on to a job that was a better fit. I continued to save. I traveled around the world and met my spouse in Rwanda. I was able to sponsor him to come to the US on my salary ($44,000 at the time!). We had a modest wedding (I've always been naturally frugal). We traveled to many different parts of the world (Ecuador, Bahamas, Australia, Panama, Costa Rica, Mexico, Rwanda, Tanzania/Zanzibar). I tried to strike a balance between saving everything extra and living a full life. My spouse was focused on education once he came here so I was the main breadwinner and I was just a social worker, no high-powered money-making jobs were happening for me. It didn't seem to matter though, I was still able to find extra money and save it.

Maternal stress money stress
Picture of us in Panama

Things really shifted when I finally secured a job at the County government. I had been eyeing jobs there because they seemed to pay more and have good benefits. Now my salary was rising and rising and our lifestyle remained the same. In fact, even after having two kids, our lifestyle hasn't changed much. We kept our same small cars. We still live small in a condo. We don't eat out a lot. So what does this story have to teach? I think it shows that even though I was from meager beginnings and a different money mindset, through my own education, I was able to radically shift my trajectory. The money I saved (and continue to save) grows with the market and will be enough to retire when we are ready. If I don't like my job or my life, I can literally just pick everything up and go on an adventure. I have financial flexibility because I live a frugal lifestyle. This has given me peace of mind and I can safely say that I am not one of that 73% of Americans super stressed about money. If you are, I invite you to reflect on how you can shift your story. Are you spending tons of money in areas of your life that aren't even meaningful? One thing I have never sacrificed in the name of frugality is travel, I love traveling and I am willing to spend money in pursuit of it. I think spending money on meaningful things is great. What isn't great is living an inflated lifestyle because you think you have kids and they need their own room or their own playroom. Traveling around the world has taught me that kids definitely don't need their own room, at least not for a long time. So why pay for it until it's absolutely necessary? Your lifestyle does not need to inflate because you have a baby. What if instead of increasing costs by getting a bigger house, stay in a smaller one and work less? How would that feel? Sometimes it's hard to go against the status quo but I am here to remind you that it is possible. And it can feel a lot less stressful too.

Most of our money problems are due to limitations in the way we think. Many people look at my life and think that they could never do it. They couldn't live in a 1 bedroom condo with 4 people or drive a small Prius with two car seats in it. But I can assure you, I am not suffering in the least and neither are my kids. We are creative with what we have and we live meaningful, authentic happy humble lives. And the reason we live this way is that we sat down and examined our life and what we truly wanted. We made difficult decisions, decisions that we knew most people wouldn't agree with. It's like Dave Ramsey says "If you live like no one else now, later you can live and GIVE like no one else." Looking around, I can safely say we are living like almost no one else but that is why we can live the lifestyle we want like no one else.

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