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Alex Melkumian

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When Money Catches Up to Ageing

Retiring. Buying a cozy house somewhere warm. Spending days by the beach, reading a book. Now, that is an ideal plan after retirement. However, I’m sure most of you already know this type of future is not only unrealistic but is becoming more and more difficult to achieve financially. While retirement can be a bittersweet moment for many, it can also bring a new set of stress and anxiety, mostly related money. Without a steady income, the lifestyle one can have starts to look different; however, that does not necessarily mean one is better than the other. In our society where working is valued so highly, what kind of condition are we going to be living under? Let’s find out.

The concept of retirement, although may sound relieving for many, can also be an exhausting thing to map out. Dan Doonan, the executive director of the National institute on Retirement Security, writes in his article, “Today, the U.S. retirement infrastructure largely is based upon individuals saving on their own for retirement during their working lives”.1 In order for the public to benefit from such structure, it becomes a requirement for the people to have a great amount of savings by the time they retire. However, the problem lies in the mere fact that many Americans do not realise how much they should be saving up right now. With inflation hitting hard, it almost sounds like an impossible ask for citizens to build up the savings they need to live a certain lifestyle they aspire to have after retirement or even to maintain the current way of life.

In addition to increases in product costs, there’s also the mere fact that our life expectancy is longer. This insinuates that unlike the previous generations where one only had to save up for 10, 15 years after their retirement, some may even be in a position to need money 30 years after retirement.2 Furthermore, many companies are leaning towards removing “defined benefit pensions”.2 These pensions were very helpful for workers to plan their retirement as it guaranteed a certain amount of money after retirement without reflecting our market’s ups and downs.2 These social changes in addition to simply the increase in costs makes it harder for the current working generation to have a good lifestyle after retirement.

These worries can compound even way before entering the golden age. It can manifest itself through overworking tendencies to compensate for the fact that it has become much more difficult to maintain the same way of life after retirement. On the other hand, the worries and exhibit itself through intense stress and anxiety towards finances and the inability to fully detach from work even during rest. These propensity for experiencing financial stress can be psychologically, emotionally, and physically draining.

What can we do? What should we do? Despite the simplicity of the question, it stands on a compounded narrative our society and culture creates surrounding money and retirement. Clearly, planning ahead is and continue to be a good idea. But beyond the practical, it is crucial to evaluate one’s emotional relationship with money. The logical mind cannot function without the emotional aspect – same goes for money.

When retirement is supposed to be the beginning of a new chapter, who wants to be worried about money and a million other things? We all deserved to have the lifestyle we have been working hard towards, right?

 

  1. Doonan, D. (2021, September 1). Stark and growing economic inequality fuels retirement insecurity. Forbes. Retrieved October 4, 2022, from https://www.forbes.com/sites/dandoonan/2021/09/01/stark-and-growing-economic-inequality-fuels-retirement-insecurity/?sh=36b5b7466632
  2. Borzykowski, B. (2022, September 21). The Ultimate Retirement Planning Guide for 2022. CNBC. Retrieved October 4, 2022, from https://www.cnbc.com/guide/retirement-planning/

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A student with debt, synonymous life with debt?

“This is how student loan debt became a $1.7 trillion crisis”

“The Student Loan Crisis Is Worse Than You Think”

“Stories of the student-debt ‘hamster wheel’ borrowers can’t escape”

“I took $20,000 in student loans and now owe $50,000”

These horror headlines are not scarce in the current day and age America. Many university and college students are drowning in debt without any sustainable system in the country to help them through the process. As many students are getting ready to move onto the next step, graduating students are becoming extra concerned regarding all the debt payments to be made for the next years to come. As if deciding the path for after an undergraduate clone rolex day date 218206 mens rolex calibre 2836 2813 automatic 15mm degree is not stressful enough, these debts never reduce in amount – the only thing they do is to continue to accumulate interest over the years. The Education Data Initiative reports a total of $1,620 trillion for the federal loan balance which accounts for 92% of student loan debt.1 For a student attending a public university, $32,880 is the average amount borrowed.1 When academic and financial worries clash on top of unexpected obstacles in life, the stress can manifest itself psychologically, emotionally, and even physically – its effects are exponential.

The problem is multifaceted and lies within a variety of systems that exist in this world. For example, school tuition has significantly increased in the past 30 years. When you compare the tuitions in 1991 to 2021, the average tuition has increased by two holds where it used to be averaging $4,160 and $19,360 in public four-year colleges and private institutions, to $10,740 and $38,070 respectively.2 Another source has even claimed an increase of 68% in the total price of tuition, fees, room and board at a public four-year college.3 On the other hand, not only household income has not doubled in the same 30 years. Due to this major discrepancy between revenue and expenses, more and more houses had started to rely on federal financial aid. Obviously, the student debt crisis is also driven due to fact that the number of people attending colleges and universities have increased.3 However, that does not explain the immense amount of strain and pressure this has on young adults.

Financial stress is overwhelming for grown adults with life experiences. It can become profusely stressful for those that just graduated from a university or college. This immense pressure may play a large role in deciding what one can or should do and don’t irregardless of one’s dreams and goals. When the financial situation has its own path, many are forced to align their goals with it in order to support themselves financially, rather than pursuing their true dream.

How do you avoid student debt? This is a tricky question – it is quite difficult to completely remove the component of receiving federal aid. At the end of the day, it is a useful tool when used with care. One thing a student can do is to have a financial counsellor to discuss their future plans before the debt is ‘suddenly’ due. Having a plan A in addition to a contingency plan can be a useful way to prepare for the future. Financial stress can be an Navulbare Vape extremely uncomfortable and scary mindset to be in while attending school. We all wish there was one magic thing that can be done to remove the negativity and the strain regards finances; however, there isn’t one. This also means there are multiple right ways of approaching one’s problem. Paying attending to emotions while dealing with finances is a big step in the right direction, despite what some might believe about the level of compatibility between money and emotions.

  • Taking to a professional
  • Always have a plan A, plan B, and plan C if possible
  • Do not shy away from the numbers. Know your financial status.

This advice is most certainly not the only ones nor will it work on everyone. However, it is a general starting point that can potentially help navigate one’s borrowing experience better than expected. No one should have to pick between knowledge and money.

 

  1. Hanson, M. (2022, August 28). Student Loan Debt Statistics [2022]: Average + total debt. Education Data Initiative. Retrieved September 27, 2022, from https://educationdata.org/student-loan-debt-statistics#:~:text=43.0%20million%20borrowers%20have%20federal,financial%20quarter%20(2021%20Q4).
  2. Dickler, J., & Nova, A. (2022, May 6). This is how student loan debt became a $1.7 trillion crisis. CNBC. Retrieved September 28, 2022, from https://www.cnbc.com/2022/05/06/this-is-how-student-loan-debt-became-a-1point7-trillion-crisis.html#:~:text=Americans%20now%20owe%20more%20in,medical%20debt%20or%20payday%20loans.&text=Every%20year%20millions%20of%20new,borrowers%20struggle%20to%20exit%20it.
  3. Whistle, W. (2021, June 28). What is driving the $1.5 trillion student debt crisis. Forbes. Retrieved September 28, 2022, from https://www.forbes.com/sites/wesleywhistle/2020/09/01/what-drives-the-15-trillion-student-debt-crisis/?sh=46d4a1ea7aec

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Inflation is Making Our Financial Mental Health Deflate

State of the economy/inflation

What a world we live in – the second the media mentions inflation, we become hyper aware of every one of our spending habits, for right reasons. Disproportional increase in cost and spending is stressful for many, especially those living within a tight budget. What makes it even worse is the uncertainty that is at the bottom of all of this. The lack of direction of the economy, decrease in costs, and confidence in ourselves can lead to a downward spiral mentally, financially, and even physically. When the status quo is broken personally and financially, what do you do? How do you react? Today, we try to answer these questions without letting them overwhelm us.

Inflation, in simple terms, happens due to our economy’s reflection of increase in production costs which then causes a noticeable increase in costs of products.1 Furthermore, when the demand is much greater than the supply and the buyers are willing to pay for them, a rise in costs also occurs.1 A common example where one can see the waves in prices would be the housing market. Not only does it reflect the demand, but it also flows with what the economy of the time is experiencing. In even simpler words,

Inflation = raising prices

To be completely frank, it damages everyone’s wallets which can be backed up by a couple of reasons. To begin, the value of our money decreases as buyers are unable to purchase what they are used to.2 It is financially demoralizing. Furthermore, it inevitably leads to a decrease in one’s savings. When income remains constant while spending increases, savings is the next place we go to.2 Finally, cuts have to be made. With a tight budget, some may leave out products or activities that are not an absolute necessity in order to cover necessary costs, such as food, housing, education, etc. Although never a good sentiment, it is quite obvious that inflation is not beneficial to the consumers.

Emotionally, it takes a toll on us also. When the money we have is devalued, it can lead to stress and anxiety which can manifested through physical symptoms.3,4 The stress of not knowing when it’s going to end and how much the prices are aaa replica rolex day date rolex calibre 2836 2813 mens 118208 automatic going to rise creates a world view where you are in survival mode against economy in the midst of uncertainty. There is no clear-cut solution nor a single decision that can be made to alter the circumstance to maintain the ongoing financial situation.

Management of financial stress is one of the key factors to create a healthy and adaptable mindset in times of emergencies and uncontrollable changes in society. The acceptance of economy’s cycle without feeling weakened is one of many ideologies that we can adapt to prevent the cycle of overthinking and self-doubt. When one’s value of money is decreased, many find it difficult to dissociate it with self-worth. In a society full of narratives that wrongfully support the interdependence between self-image and money, it is our goal to detach them as separate entities and be grounded in our values and beliefs.

At the end of the day, the economy may be able to decrease the value of the money we have, but it should never be given the power to depreciate our self-appreciation or self-care.

 

References:

  1. The Investopedia Team. (2022, August 10). What causes inflation and who profits from it? Investopedia. Retrieved September 19, 2022
  2. Williams, G. (2022, July 29). Why is inflation bad? 3 effects of inflation. Forbes. Retrieved September 19, 2022
  3. Fielding, S. (2022, August 1). High inflation rates impact almost every aspect of our lives, including Mental Health. Verywell Mind. Retrieved September 19, 2022
  4. Financial Consumer Agency of Canada. (2019, March 28). Government of Canada. Canada.ca. Retrieved September 19, 2022

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How taking time off can benefit your mental health

When it comes to using paid time off, many Americans just don’t do it. In part, that’s because of a major cultural narrative that hard work will allow you to reach your goals.

“That narrative has really ground us into this workaholic sort of mentality,” says Dr. Alex Melkumian, LMFT and Psy. D. “It actually became cool to work 24/7, to be available via email all the time.”

But this lifestyle has plenty of drawbacks and may negatively impact your mental health. Taking a vacation is an important way to practice self care, whether you’re planning a long trip abroad or a three-day staycation.

Here’s a look at how taking paid time off can benefit your mental health and actually make you a better employee.

Why your mental health needs a vacation

Even before the pandemic forced people to stay at home, workers weren’t great about taking time off. A 2019 Bankrate survey found that only 38 percent of Americans with paid vacation days planned on using all of them. And according to the U.S. Travel Association, Americans forfeited 236 million vacation days in 2018, which is equivalent to $65.5 billion in lost benefits.

Work and life can be full of daily struggles, and “chronic stress negatively impacts our physical, emotional and mental health,” says Lindsay Bryan-Podvin, LMSW and a financial therapist.

Unfortunately, the negative impacts of stress increased during the coronavirus pandemic, according to the Kaiser Family Foundation. About 4 in 10 adults in the U.S. reported symptoms of anxiety or depression in 2020 and 2021, up from 1 in 10 in 2019.

A vacation may counteract the effects of stress and potentially help improve your mental health. Here’s why.

Vacations engage your senses

When you’re immersed in a different environment, all of your senses are heightened — especially if you’re experiencing a different culture. Engaging your senses generally helps lower your stress, says Wendy Wright, LMFT and financial therapist.

On vacation, “you are constantly engaging and bombarding your five senses, so it allows new thought loops and you get a different perspective,” Wright says. Breaking out of a repetitive mindset may help you cope with stress or a difficult situation in a healthier way.

Vacations may strengthen relationships

Even with Zoom chats and phone calls, the physical distance from others left many feeling disconnected during the pandemic. A vacation provides an opportunity to strengthen the important relationships in your life, whether you’re taking a trip with friends or family members. And as COVID-19 cases are falling and more people are vaccinated, the ability to safely travel with others is growing.

Vacations can increase your creative thinking

If you’re often stuck in a decision-making loop that’s on repeat every day at work, then you’re only using some of your skills. It’s a lot like the quarantine many are experiencing, “which is why it has felt boring and also despairing; it’s so repetitive,” Wright says.

But on vacation, engaging different parts of your brain kick-starts the creative process and helps you “re-enter work with some fresh ideas,” Wright says.

Taking trips increases your adaptability

Adaptable workers are flexible and can adjust to change with a positive mindset, making it a highly desirable trait in any employee or manager. Taking trips can improve that skill because “it gets us out of our norm,” Melkumian says. “You’re being immersed in something completely different, especially if you’re traveling to a place that’s very different from where you usually live.”

For example, visiting a different country may expose you to a new language, culture, transportation system and social environment. Navigating those challenges helps you become more adaptable and can increase your self-esteem.

Reasons you should take your PTO

Workers in the private industry receive an average of 15 paid vacation days after five years of service, according to the Bureau of Labor Statistics. While some companies allow their workers to roll over the accrued PTO, others have a use-it-or-lose-it policy.

“From a financial standpoint, you should take your PTO because otherwise, you aren’t taking advantage of an earned benefit,” Bryan-Podvin says. “It’s just as silly to not take PTO as it is to tell your boss, ‘No thanks, I don’t really want that raise.’”

In addition to the financial reasons to take PTO, there are other reasons it could be a good idea.

Taking PTO may lead to a promotion

Employees often feel they need to work long hours to pull ahead in their careers, especially if they’re just starting out. But that doesn’t help you with efficiency, effectiveness or creativity. Instead, overworking yourself can lead to burnout and seriously drain your productivity.

Vacation helps you avoid burnout because the time away allows you to refresh your mindset and develop problem-solving tools. It also helps you set boundaries and practice self-care at work. In fact, according to a Project: Time Off report, people who use all of their PTO days have a 6.5 percent higher chance of getting a promotion or a pay raise than people who only take a few days off each year.

Taking PTO may heal work anxiety

While it’s not a specific diagnosis, you might experience work anxiety if you’re constantly thinking about work, you’re worried your colleagues dislike you or you’re afraid of losing your job. Taking PTO can give you time away from the workplace — and the people in it — which can help you break out of these thought processes and deal with what’s behind them.

Planning your PTO is rewarding, too

During the pandemic, the monotony hasn’t given us much to look forward to — but planning a trip or a staycation gives you a sense of anticipation and purpose.

“When we anticipate something good happening, we get to live it in our minds again and again,” Bryan-Podvin says. “It also allows us to use our imagination and daydream, letting us tap into the creative side of our brains that don’t often get as much stimulation.”

Using PTO helps you recharge

Some vacations may not reduce stress at all because they involve long flights or too much stimulation. But a vacation is simply any time you break out of your normal routine, and it’s important to find a good balance for yourself. One study in the Journal of Happiness Studies found that you need eight consecutive days to really unplug from work and feel happy. If you don’t have eight days to spare or you just need a quick way to recharge, you could use a day or two of PTO to relax.

“I love a good staycation and believe that exploring where we live like tourists can make us feel more connected to our sense of home and community,” Bryan-Podvin says.

Bottom line

Getting time away from the daily grind is essential to your mental health, which is certainly something that should be prioritized.

It’s a good idea to know how much PTO you have and in what circumstances you could lose it.

If you’re self-employed, Wright suggests putting aside a certain amount of money every week to form your own PTO fund. But if you do work for someone else, Wright recommends talking with your manager about when to use your PTO and how to delegate tasks while you’re gone.

“Remember your priorities,” Melkumian says. “Your family, your friends, your mental well-being, your health. Things like that are more important than sticking it out for your employer.”

***

This article was written by Kim Porter and first appeared in Bank Rate: https://www.bankrate.com/personal-finance/smart-money/vacation-time-and-mental-health/

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When Money Catches Up to Ageing

It is with no surprise that we are in the society where the population continues to age. With longer life expectancy combined with decreased fertility, many countries are beginning to see a shift, making up more and more of the population. This pushes us to go beyond maintaining any type of social or financial structure we have and forces us to develop new policies in order to support the elder age bracket whilst not neglecting the younger and middle-aged groups. Many expect there to be a drastic social change; however, the financial implication this brings is often forgotten. Money is a crucial factor on personal and global levels, and we need to keep in mind how it can affect us practically and emotionally during these unpredictable times.

In 2020, it was estimated that there were 727 million people older than 65 years of age.1 However, the population is expected to double by 2050 – reaching 1.5 billion people in the same age category, meaning that one out of six people will be aged 65 or above globally.

Millennials (those born between 1981 and 19962) will feel the financial burden from both directions as the population ageing problem becomes apparent to the world. Not only would they be responsible to take care of their family, such as their partner and children, but they now are also responsible for looking after their parents. Advanced health care in addition to undisturbed food-chain supply has made it possible for many families to have three generations, and sometimes more, at the same table. Though it is a notable change, the financial load is not insignificant. Compounded with inflation, millennials might start to experience underearning after taking on the responsibility of not only taking care of children but also their parents for years to come. Financial stress that is created via this funnel of people becoming older can manifest into negative thoughts, stress, insomnia, and for some, depression. Money problems have always been one of the leading causes for stress and anxiety and the ageing population does not help.

The younger generation, on the other hand, may experience a difference set of difficulties such as profession shortages seen in the labor force. Just like a gust of wind, a drastic shift can change the norm of the environment very easily. In this case, it can lead to an increase in labor costs, which is another type of money problem the younger generation has to keep in mind.

It is not to say that an advanced health care system is bad – it is one of humanity’s biggest accomplishments. However, we must keep in mind the severe and potentially catastrophic socio-economic consequences that will ultimately alter our lives and way of life.

  1. United Nations. (n.d.). Population division |. United Nations. Retrieved August 8, 2022, from https://www.un.org/development/desa/pd/
  2. Age range by generation. Beresford Research. (2022, April 20). Retrieved August 8, 2022, from https://www.beresfordresearch.com/age-range-by-generation/

 

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When You Crash With Money

Money is something not often thought about until you have to deal with it. As a child we have no sense of responsibility or independence in any aspect of life including finances. Most children are unaware of how to manage money and are taught they must ask for money from their parents if they wish to have any. While teenagers are yearning for independence, they start to find ways to make money, but they still are not given an understanding of their relationship with money. Instead they are simply retaught how to get it. At this time it is not simply asking their parents, now they can work for it. People then grow into adulthood with a concept of how to make money, but little understanding as to how money affects their emotions and how they might have a healthy balance of their emotions around the topic of money. In fact, money and emotions are are treated separately. But what is so dangerous about those two aspects being dissociated from each other? Is it better to be emotionless or is that the start of all financial evil? We will find out.

The polarizing opinions in regards to how the human emotions should be introduced to deal with financial struggles have been heavily debated over the years. On one end, emotions are seen as a sign of weakness and subjectivity that negatively influences any financial decision we make in the course of our life. But we take a different approach that is more inclusive of our human nature, which is acknowledging our emotions to the fullest while not letting it takeover our decision making process. That way, it allows us to embrace the way we react to reality without seeing it through a distorted lens. From this status quo of emotions being involved in financial decisions, that leads us to pursue an unconventional solution to a conventional problem.

The effort to plan, budget, and spend less have been the pillars to financial stability, well at least it used to be. However, in the recent years we have come to the realization that having a lot of money does not fix the solution. Many people who learned how to make more money remain financially stressed, which demonstrates that financial stress requires a psychological solution. Although the practical strategies, such at budgeting and planning, are important, being aware of yourself and your relationship with money is the first step in the right direction.

Integrated financial therapy introduced a multi-modal approach to financial struggles – a new innovative outlook to money. As with making any changes in your habits, you first must acknowledge what is needed to change. That can be achieved via introspection, self-awareness, and emotional intelligence. These do not necessarily involve practical skills but rather a critical assessment of self which can be challenging for many of us that constantly distract ourselves from self-analysis. There are different types of therapies that emphasize a multi-modal approach: narrative therapy, cognitive behavioral therapy, and object relational therapy.

We don’t realize the importance of self-reflection until it’s too late or too much financial stress has been on one’s shoulders. It is okay to face a financial obstacle but it is in hour hands to overcome it.