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Little-Known Research Study Links Financial Planning with Psychological Benefits

Announcement posted by Approved Financial Planners 06 May 2015

Financial planning firm in Perth uncovers obscure research study indicating that financial planning provides a plethora of psychological benefits.
Perth, WA, 06 May 2015 - To most financial planners in the Perth area, the notion that financial planning increases one’s sense of well-being is considered a “no-brainer.” Most see it as “common sense” that someone whose present and future are secure would have a better sense of well-being than those who are worrying about where their next dollar is coming from. Many would also see it as “common sense” that people who increase their wealth would display more satisfaction with their lives on life satisfaction surveys.

However, many may not know about a research study that assembled a plethora of research about financial planning and psychological well-being. The study was authored by Kym Irving of Queensland Institute of Technology in 2012 and published in the Australasian Accounting Business and Finance Journal, Volume 6, Issue 4.

What the Research Indicates

According to the study, there is a link between life satisfaction, psychological well-being and financial planning. For the study, Ms Irving referred to a traditional, six-step model of financial planning. In that model, clients determine their scope of engagement, set goals, assess their financial situation, come up with a plan, follow the steps in the plan and review it both regularly and when significant life changes occur.*

Out of the six steps, the three that seem to have the most positive effect on well-being are goal setting, planning to attain those goals and being engaged with one’s daily tasks.*

Goal Setting

Ms Irving’s research indicates that goal setting often adds purpose and structure to life. According to her research, people who have a set of goals as a vision of their future tend to believe their lives have more meaning and are more likely to see their lives as “worthwhile.” The goals don’t necessarily have to be attained for the client to enjoy psychological benefits; they are a by-product of the journey, not the result.*

Having a Good Financial Plan

Creating a plan for the future helps one become more engaged with their daily tasks. Engagement is now seen as essential to a sense of psychological well-being. Having a plan and taking steps towards fulfilling that plan create a sense of mastery over one’s environment. This sense of environmental mastery is very empowering and is now seen as a causative factor in reduced anxiety, reduced depression, a better sense of well-being and an overall improvement in one’s state of mental health.*

Reality vs Perception

According to Daniel Stevens, Financial Planner at Approved Financial Planners in Perth, “Most financial planners had already figured out that people who provide themselves with a more prosperous lifestyle and ensure their futures tend to be happier and have a better sense of well-being, but it’s nice to see that there is some research to support it.”


*Kym Irving, 2012. Australasian Accounting Business and Finance Journal, Volume 6, Issue 4. “The Financial Life Well-Lived: Psychological Benefits of Financial Planning.”

Approved Financial Planners is a financial planning firm with more than 80 years combined experience in providing financial planning help in Perth. They offer a wide array of financial services, including financial planning, estate planning, wealth protection and many others. To learn more about the benefits of financial planning, call 1300 787 274 or visit their website: http://www.approvedfp.com.au/.


Approved Financial Planners

Approved Financial Planners Pty Ltd ABN: 52 116 910 528, trading as Approved Financial Planners is an Authorised Representative and Credit Representative of AMP Financial Planning Pty Limited ABN 89 051 208 327 Australian Financial Services Licence 232706 and Australian Credit Licence 232706.

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