Your financial behavior affects not only the size of your wealth but also your health

Your financial behavior affects not only the size of your wealth but also your health

Of course, your financial behavior has a direct impact on the size of your wealth. As long as you manage your money in a healthy way, you gradually build and improve your property over time. But did you know that your financial behavior and even the size of your possessions also affect your health?

People who manage their money well are on their way to achieving good financial health and financial well-being. Financial well-being is a state when:

• you have the sufficient financial security to be able to live and enjoy life according to your wishes and
• you can fulfil your current and future goals and dreams.

People who regularly spend all they earn on their consumption may live their lives in abundance and luxury, but they are not actually building or improving any wealth. Research shows that if you are not in control of your financial behavior, you feel stressed. No matter how much money you make. Research from 2019* found that people with the highest incomes experience financial stress to exactly the same extent as people with the lowest incomes.

Conversely, knowing that you have enough assets to cover your expenses for a few months if necessary, for example in the event of an unexpected event such as an accident or job loss, gives you more freedom and reduces your potential financial stress. Also, if you own property, you can use it, for example, to pay an annuity or passive income. The 4% Rule describes practices for achieving regular annuity payments so that your capital lasts forever and never runs out.

By gradually building passive income, you reduce the pressure on your active income, thereby reducing the potential fear of losing your job.