by Kaitlyn Ranze | 19 November 2020
We’re all about nav.igators making bank and doing what they can with what they have but research with Angus Deaton discovered that after reaching an income of $75,000, emotional wellbeing didn’t improve along with a rise in income.
Guess what does improve your emotional, mental, and financial wellbeing? Gratitude.
Gratitude (noun) -the quality of being thankful; readiness to show appreciation for and to return kindness.
So, how can changing the way you think modify your behavior, and more importantly, how can you make a profit off a daily practice of gratitude?
Gratitude actually reduces the likelihood of impulse spending.
If you make unplanned purchases on a whim, you impulse shop. You’re not alone, however. Five of six Americans admit to impulse spending.
Why do we impulse shop in the first place? We get a dump of dopamine when we shop.
WTF is dopamine? It’s a neurotransmitter, or chemical messenger, that is released when we’re anticipating something. It makes us feel motivated, alert, focused, and happy. Dopamine also helps us plan, learn, and be productive. Expert at nav.igating the mall AND a sales rack? Dopamine may have something to do with that. But there’s more to your feelings while shopping.
Unpredictability increases anticipation and dopamine.
That means not being SURE that you’ll find something can boost the impact of dopamine. It’s also why online shopping is so addictive. In the report entitled Digital Dopamine, results were presented from interviews of 1,680 shoppers. “76% of people in the US, 72% in the UK, 73% in Brazil, and 82 percent in China say they are more excited when their online purchases arrive in the mail than when they buy things in store.”
Online Shopping and Dopamine
So anticipating the arrival of packages? Totally triggering your neurochemistry.
Not only that, researchers at Stanford found that when you see pictures of items you’d like to buy, a region of your brain with dopamine receptors is activated. The simple act of window shopping online could dump some dopamine becoming part of your cycle of motivation, reward, and reinforcement.
Why does all this matter?
Two reasons. One, dopamine is a bit addictive and two according to a study published in the journal Psychological Science, feelings of gratitude can combat a tendency toward instant gratification and impulse spending. In fact, participants in this study showed more patience and self-control when they had higher levels of gratitude.
A moment of gratitude can help deter impulsive spending.
Hedo-what?
How else can gratitude improve my finances?
Gratitude can fight off the negative effects of hedonic adaptation.
Hedonic Adaptation (noun) -refers to the notion that after positive (or negative) events (i.e., something good or bad happening), and a subsequent increase in positive (or negative) feelings, people return to a relatively stable, baseline level of affect (Diener, Lucas, & Scollon, 2006)
It’s really helpful when you go from a good situation to a less desirable situation, such as losing a job. But hedonic adaptation goes both ways.
Example time:
That poor but happy broke college student that suddenly gets an influx of cash after college? Their spending increases but their overall satisfaction and happiness revert back to stability after hedonic adaptation.
It’s why the phenomenon of lifestyle creep is so prevalent among higher-income earners – discretionary spending becomes inflated because wants are perceived as a right versus a choice— a necessity versus a want.
Practicing gratitude can help shift your mindset.
When you feel grateful for what you have, you are also more likely to feel content with your situation. No more keeping up with the Joneses or feelin’ the need to treat yo’ self.
On top of that, using gratitude to get beyond instant gratification can save you money by encouraging you to save up for bigger purchases. With increased patience, you’ll save money on interest and maybe even decide you don’t need that item after all.
In summary, the financial benefits of being thankful:
- You’ll do a better job of sticking to your budget because you don’t feel like you need “more.”
- You’ll be more patient, better at setting goals, and avoid impulse purchases
- You’ll have increased contentment enjoying what you already have.
Financial incentives of gratitude not motivating enough to be more thankful? Gratitude can improve your physical wellbeing.
With gratitude, you’re physiologically likely to achieve:
- Less stress. Gratitude reduces levels of stress by activating the parasympathetic nervous system and reduces cortisol levels. Get a pit in your stomach and have trouble sleeping during a stressful situation? Gratitude and your parasympathetic system basically undoes the work of the sympathetic system.
- Better sleep: There are multiple studies that show that gratitude improves sleep. In a study of over 400 participants, 10% of which had clinically impaired sleep, grateful people reported falling asleep more quickly, sleeping longer, having better sleep quality, and staying awake more easily throughout the day. This isn’t isolated to healthy people. In one study of 65 subjects with a chronic pain condition, those who were assigned a daily gratitude journal reported half an hour more sleep than the control group.
- Better heart health: In one study, patients with high blood pressure who participated in gratitude phone calls achieved statistically significant decreases in their systolic blood pressures, whereas study completers in the control group did not.
Lastly, gratitude improves mental wellness.
While people who impulse shop are more likely to experience anxiety, those that have more gratitude are more likely to have a more proactive coping style, are more likely to construct strong support systems, are less likely to develop PTSD, and are more likely to be psychologically resilient and grow in times of stress. Not only that, a 2008 study by psychologist Alex Wood in the Journal of Research in Personality, showed that gratitude can reduce the frequency and duration of episodes of depression.
You grateful for gratitude, yet?
By focusing on what you’re grateful for, you’ll reap financial, physical, and psychological benefits that will make you feel more fulfilled when it comes to your money. So get to work on your mindset and don’t forget that you can track it and your financial wellness with the nav.it money app.
Related topics:
Spending and Behavioral Change: Joining a Community on a Debt Free Journey
How to Stop Impulse Buying and Blowing Your Budget
