5 ways a financial planner could support your mental wellbeing

Financial News

Financial planner helping a couple

While you’re navigating the trials and tribulations of everyday life, money worries are perhaps one of the main things that can exacerbate your mental health concerns. 

In fact, Money and Mental Health reveals that 46% of people in problem debt also have a mental health issue. Moreover, 86% of survey respondents with an experience of poor mental health said their financial situation made their issues worse. 

Conveniently, 13 to 19 May is Mental Health Awareness Week, and possibly one of the best ways to tackle your money worries is by working with a financial planner. 

A study from Royal London even shows that those who worked with a planner noticed a marked boost to their emotional wellbeing, as working with a professional helped them feel less anxious about household finances and more confident about the future. 

Continue reading to discover exactly how working with a financial planner could improve your mental health. 

1. They can ensure you have an adequate emergency fund

A common cause of stress and anxiety regarding your finances are the “what if?” scenarios that would mean you have to dip into your savings, hampering your progress towards your long-term goals. 

These often unexpected events, such as a period of unemployment, could deteriorate your mental wellbeing. 

One of the ways to ensure you’re prepared for financial hurdles could be with an emergency fund. 

It’s typically worth saving between three and six months’ worth of essential household expenditure in an easy access savings account. 

However, the exact amount worth saving can vary depending on your individual circumstances, such as if you have many dependants or are self-employed. 

As such, a financial planner can make sure that you’ve saved enough to protect yourself and your loved ones from the unexpected by tailoring an emergency fund to your specific needs.

With their help, you might be less likely to rely on savings you’ve earmarked for other purposes in the event of an emergency, providing you with much-needed peace of mind. 

2. They can give you peace of mind about your retirement

Retirement can be another source of worry, with 19% of Brits having spent sleepless nights worrying about this next phase of their life, and 15% stating it has resulted in poor mental health, Standard Life reports. 

Thankfully, a financial planner can help you map out your future, putting your mind at rest and giving you the confidence that you’re on the right track.  

Even if stopping work seems a long time away, it’s never too early to start taking steps now to ensure you’ll live a comfortable retirement. 

If you work with a financial planner when it comes to your retirement, they will help you develop a plan regarding your pension. The topics they touch on could help you figure out: 

  • When you want to retire
  • What you plan to do when you stop working 
  • How much it could cost to maintain your lifestyle.

Once they’ve helped you put a comprehensive plan in place, your planner can take the time to review it when your circumstances change. This can help you keep on track with your savings goals and give you regular reassurance that you’re in control.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available.  

3. They can make sure you’re protected from the unexpected

An emergency fund won’t always cover you in the “what if?” scenarios – sometimes, you may need an extra layer of support.

This could come in the form of financial protection, and your planner could ensure that you and your loved ones would be adequately safeguarded in the face of the unthinkable.

For instance, imagine what might happen if you pass away – would your loved ones still be able to maintain their standard of living without you? While these scenarios can be challenging to consider, ensuring that your family will be looked after when you’re gone is essential. 

One way to do so is through life insurance, which pays your family a lump sum should you pass away. 

With life insurance in place, this could give you immense comfort knowing that you’ve made arrangements for them during a time that will likely be filled with grief.

Similarly, it can be stressful thinking about a sudden loss of income, perhaps from a serious illness or injury, and how you and your loved ones would cope financially. 

Two forms of protection that can safeguard you from this include: 

  • Income protection – pays you a regular income if you become seriously ill
  • Critical illness cover – offers you a lump sum payment if you’re diagnosed and can no longer work.

Without these, you and your loved ones may struggle to make ends meet if you can’t work for an extended period of time. You may need to dip into your savings, which could derail your progress towards your long-term goals. 

As such, your financial planner can ensure you have the correct levels of protection for your specific circumstances, potentially alleviating any feelings of anxiety for the future. 

Note that protection plans typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse.

Cover is subject to terms and conditions and may have exclusions. Definitions of illnesses vary from product provider and will be explained within the policy documentation.

4. They can help you make a plan to deal with unsecured debt

Debt is a significant catalyst for stress for many, with the Mental Health Foundation revealing that 20% of survey respondents claimed it made them anxious in the last two weeks. 

If you have unsecured high-interest debt, such as from credit cards or bank overdrafts, the interest on these can quickly snowball, exacerbating your mental health concerns. 

The good news is that a financial planner could help you create a plan to deal with it quickly and effectively. 

They may suggest that you start by clearing any debts you’re paying the highest interest on, then encourage you to work through them one by one until you’re completely clear. 

Simply sitting down with a planner and discussing your debt can be an immense source of relief. Even before you pay it off, just knowing that you have a plan to deal with it may boost your mental wellbeing.

Above all, having someone in your corner to help tackle your unsecured debt concerns can give you immeasurable peace of mind. 

5. They can help you understand complex financial matters and legislation changes

Financial matters can undoubtedly be complex, and legislation frequently changes. 

This can make it difficult to understand how your wealth may be affected, and staying on top of changes can be taxing for your mental health. 

A financial planner can help translate complex financial matters into clear, understandable terms. They can explain legislation changes and simplify intricate concepts, making it much easier to digest financial information. 

This could empower you to make informed decisions regarding your wealth, potentially reducing any anxieties you have about making mistakes. 

Since their professional knowledge can translate to lower levels of stress and anxiety, you can rest assured that you’re receiving tailor-made advice that is personalised to your current circumstances. 

Get in touch

To find out how our expert advice could boost your mental wellbeing, please contact us by email at info@investmentsense.co.uk or call 0115 933 8433.

Please note

This article is for general information only and does not constitute advice. The information is aimed at retail clients only.