Here are some interesting facts: according to the aforementioned survey, 59% of people are convinced that money can buy happiness. More specifically, 72% of Millennials and 67% of Gen Z. The relief we feel when we are financially independent is a sum of joy, freedom and personal satisfaction. If that is not the definition of happiness, let’s call it a day!
It is also true that the amount capable of making us truly happy varies greatly depending on our age. On average, we settle for “just” over a million euros to face life with a different spirit. But, as you can see in the graph, the new generations have very different points of view, with the zoomers being the most restrained:
Challenges on the path to happiness: reducing ant expenses
During this incessant search, obstacles keep appearing in our path… 73% of the population experiences financial stress, and factors such as inflation, rising prices and interest rates affect our sense of well-being. 36% of those surveyed also affirm that they could not afford an unforeseen expense of more than €500. To improve our financial situation, the first thing we must do is pay attention to how we spend money.
What are ant expenses?
As Business Insider defines them, these are small expenses that are not essential, but that end up affecting our economy. These are usually unimportant amounts we do not pay attention to and, of course, they become a problem at the end of the month. Those euros that escape us day after day end up in an average amount of €1,500 at this time of year.
How about that? We help you identify them so you can improve your financial situation:
Little vices and whims
Expenses on alcohol and tobacco are the most obvious, as they have a high tax burden that increases their price. Of course, their social nature makes it very difficult to eliminate them completely (although it would be best for our financial and physical health), so opting for alternatives such as vapes can mean interesting savings. Drinking coffee out daily also means a significant amount for our pockets.
Our leisure is increasingly associated with consumption and it can be negative to go to the mall just to hang out. It has been proven that boredom or bad feelings encourage us to put many products that we do not need in our shopping cart. We must think that merchants study the location of the articles to make it more appealing, especially the one located near the checkout, Vade retro!
Something similar happens in the supermarket: carts that turn towards the shelf instead of going in a straight line, eye-catching packaging for the most expensive products… It’s all temptations! How to overcome them? Try to always pay in cash and carry a list of the food you do need. Another trick is to buy white label products when quality is not compromised. There are many well-known brands that manufacture for large distribution chains. A few minutes of research can save you hundreds of euros a year!
Nowadays, fuel, tolls or the maintenance of your car (or cars) can harm your economy. Think about whether you really use your vehicle and avoid expenses such as insurance, MOT or oil changes, among others. Depending where you live, you can consider cheaper and more sustainable alternatives: public transport, electric bikes and scooters or shared mobility. If you work less than half an hour from home, you can also choose to walk, and get a toned body!
Dining out, having a drink afterwards… The attitude towards money during a night out is as relaxed as we are. You can have fun, but be aware of what you spend or you will come home with less money than you expected. It’s not a bad idea to make a small budget beforehand or go out with an old cell phone and no cards.
Analyzing the conditions of our electricity, internet, gas and water suppliers it is vital to reduce bills. You can try to negotiate or change to another company. The important thing is to know what exactly you need and not pay for services that you are not using. On many occasions, contracts offer estimations that do not correspond with reality. Even if you are lazy, we encourage you to review them, it can mean great savings in a short time.
Now that we’re reviewing contracts… What do you think about doing the same with your bank and insurance company? Maybe you are paying small amounts for cards or processes such as over-the-counter procedures, of which you are not aware. Think that everything counts and those euros are slipping through your fingers.
Make a couple of calls or negotiate with your agent to have them removed. You may have to change the conditions of the contract, but it will be once and for all, cheer up!
The financial plan as a catalyst for happiness
For many of us, financial independence, the ability to deal with unexpected expenses and being able to help our loved ones when they need it are the pillars of happiness. There is no doubt that it also gives us peace of mind to have emergency savings funds for retirement. How can we better organize expenses and income to continue increasing our financial health?
Here we give you all the keys:
Start using a personal finance manager
According to The Currency survey, people who have detailed plans to guide them when managing their household finances are up to 3 times more likely to achieve happiness. The tools called PFM (Personal Finance Manager) help us automate this plan and allow you to save effortlessly. Let’s see how they work!
These are modules that use technology capable of analyzing the information that appears in each banking transaction to show recommendations and establish improvements for the user. Through open banking, these modules connect bank accounts and show a complete view of the financial situation. With all this information…
A Personal Finance Manager can perform the following tasks automatically:
- Create budgets based on expenses and income.
- Set savings goals and suggest strategies to achieve them.
- Provide investment advice using predictive analysis.
- Send alerts to remind us of pending payments, for example.
- Categorize expenses so we know where our money goes.
Thanks to artificial intelligence and machine learning, they are also capable of generating very useful financial insights, such as recurring expenses, consumption habits, insurance coverage, savings capacity, etc. For that, there are also applications capable of helping us save automatically, through contributions with each goal scored by our favorite team or by activating rounding on each card purchase.
Only a part of the population associates happiness with achieving a specific net worth. Most feel that achieving specific goals has a more significant impact on their life. Now that you know how to make these small changes transform your finances, we just can say:
Go for it!