The relationship between money and happiness is quite complex. Studies show that the more income you have, the more happiness you have, but only up to a certain point.1 You probably won’t be shocked to hear that the income level required to reach that point has increased dramatically in recent years. However, regardless of your financial status and happiness level, you may still be among the 88% of Americans who say they are financially stressed.2
Many factors can cause financial stress, such as the economy, expenses, savings, debt, and readiness for retirement, which may not correlate with the amount of your assets. The annual tax season, for example, can be stressful for anyone. Worrying about money could severely impact one’s mental and biological health. Approximately 41% of Americans have attributed finances to “destroying” their mental health, causing them to ignore their hobbies, eat unhealthily, and withdraw from social activities.2 As you can imagine, this financial stress leads to reported physical symptoms, including sleep deprivation, fatigue, and headaches.
Having an outside perspective from a trusted source can help with relieving money worries whether they’re related to investments, taxes, retirement, estate planning, or other reasons. A Fidelity study reported that investors who work with an advisor are generally more confident about reaching their financial goals.3 That’s why Mercer Advisors exists — so you don’t have to worry about money.
Addressing causes of financial stress
Here are some of the concerns we hear from new clients who come to us for financial advice and, broadly speaking, how we might address them. In every instance, our guidance is ultimately tailored to fit the personal circumstances of our client.
- Cash flow: One way to build wealth is to know how your cash is flowing. Managing cash flow isn’t the same as having a monthly budget. It’s more about understanding the money you have coming in and understanding the money that’s going out. It’s about knowing and directing your cash flow in a productive manner, instead of just letting it follow the path of least resistance. Cash management helps align your financial life with your family’s short- and long-term goals. Once you understand your cash flow, it’s time to explore opportunities for increasing cash flow.
- Debt: It’s important to distinguish between good debt and bad debt before deciding how to tackle it. Good debt allows you to borrow money that helps with future net worth as well as aligns with your personal goals. Bad debt is often driven by emotion and making purchases that aren’t needed, leading to a strain on your financial resources. If your debt is causing you financial stress, I encourage you to discuss this with a financial advisor, whether it’s considered “good” or “bad” debt.
- Investments: Investing takes a lot of time and training, so having a fiduciary advisor you trust can help relieve you from those possible stressors. An independent SEC-registered investment advisor (RIA), like Mercer Advisors, has a fiduciary obligation to always operate in your best interest, as opposed to a broker-dealer, bank, or insurance company. We have a team of professionals overseeing clients’ portfolios and investing based on facts plus we have access to some of the top fund managers in the world, often at lower fees than you could access on your own.
- Market volatility: When it comes to investment strategy, patience might be the best virtue. Rather than monitoring the market daily and relying on emotion or limited information to drive your investment decisions, a disciplined long-term plan and a diversified portfolio can best serve you. Especially during a market drop, making drastic changes such as leaving the market or stopping retirement contributions can have long-term negative effects.
- Taxes: Tax codes are extremely complex and typically difficult to follow, which is why tax professionals can offer so much value. Even more valuable can be a complete view of your overall financial picture to determine how you might minimize taxes by making charitable contributions, selling assets at a loss, contributing more to a retirement account, gifting to loved ones, and more. Relying on professionals in tax planning and tax saving could be one of the best ways to help relieve financial stress.
- Retirement: Do I have enough money to retire? It’s a question a lot of people ask, and my personal favorite question to answer, as an advisor. The short answer can be frustrating, which is, “it depends.” There are general guidelines that can help with determining your retirement readiness, including establishing a retirement account withdrawal rate, knowing what percentage of your retirement will be dependent on your investment portfolio, and diversifying your assets. Having a retirement checklist is also helpful. However, this question is best answered by doing a deep dive with a CERTIFIED FINANCIAL PLANNER® professional who will answer this question based on your unique goals and preferences.
- Estate planning: Worrying about your financial legacy or whether your family will be financially secure after you pass away is natural. An estate plan gives you control over important decisions that can impact you and your family now, as well as when you’re gone. Since estate plans often need updating, due to life events and regulatory changes (that you may not be aware of), it’s important to consult with an estate planning professional to help minimize common mistakes.
Choosing not to worry
If you’re suffering from symptoms of financial stress, there is a resource. You can depend on professionals with years of experience in financial planning, investment management, tax, estate, insurance, and more. They can help you save time, provide expertise and objectivity, and support your efforts to build wealth.
At Mercer Advisors, we offer a unified in-house team of advisors, planners, investors, accountants, and estate strategists to collaborate with you on creating your own comprehensive financial plan — to help relieve your financial stress. Not only do we help you create a plan, but we also put it into action. When you’re ready to stop worrying about money, let’s talk. If it’s your parents or another loved one who is worrying about money — give them the gift of Economic Freedom™.
1 “One study said happiness peaked at $75,000 in income. Now, economists say it’s higher — by a lot.” CBS News, 26 Jul 2024.
2 “Financial Stress Survey: 65% of Americans Say Finances Are Their Biggest Source of Stress.” MarketWatch, 1 Oct 2024.
3 “3 ways an advisor can help make a difference.” Fidelity, 23 Apr 2024.
Mercer Advisors Inc. is a parent company of Mercer Global Advisors Inc. and is not involved with investment services. Mercer Global Advisors Inc. (“Mercer Advisors”) is registered as an investment advisor with the SEC. The firm only transacts business in states where it is properly registered or is excluded or exempted from registration requirements.
All expressions of opinion reflect the judgment of the author as of the date of publication and are subject to change. Some of the research and ratings shown in this presentation come from third parties that are not affiliated with Mercer Advisors. The information is believed to be accurate but is not guaranteed or warranted by Mercer Advisors. Content, research, tools and stock or option symbols are for educational and illustrative purposes only and do not imply a recommendation or solicitation to buy or sell a particular security or to engage in any particular investment strategy. For financial planning advice specific to your circumstances, talk to a qualified professional at Mercer Advisors.
Tax preparation and tax filing are a separate fee from our investment management and planning services. Mercer Advisors is not a law firm and does not provide legal advice to clients. All estate planning document preparation and other legal advice is provided through select third parties unaffiliated to Mercer Advisors.
Mercer Global Advisors has a related insurance agency. Mercer Advisors Insurance Services, LLC (MAIS) is a wholly owned subsidiary of Mercer Advisors Inc. MAIS provides individual life, disability, long term care coverage, and property and casualty coverage through various insurance companies. For Mercer Global Advisors clients who wish to purchase insurance products, MAIS has entered into a non-exclusive referral agreement with Strategic Partner(s), where the Strategic Partner will provide necessary services relative to the marketing, placement, and servicing of the insurance products, including without limitation preparing and presenting illustrations, supporting the underwriting process, assisting with the completion and execution of applications, delivering policies, and servicing in-force business. MAIS and the Strategic Partner will be listed as either “agents” or “co-agents” on the policies. While Mercer Global Advisors does not receive a referral fee, Strategic Partner receives a percentage of the commission revenue. MAIS and Strategic Partner do have a revenue sharing agreement.
Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the CFP® certification mark, the CERTIFIED FINANCIAL PLANNER® certification mark, and the CFP® certification mark (with plaque design) logo in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.
