We know how your mental health can affect the way you deal with money. If you’re feeling low or depressed, you may lack the motivation to manage your finances. It might not feel worth trying. Thinking of the future is hard when you have no motivation to do so. Spending may give you a brief high, so you might overspend to feel better. You might make impulsive financial decisions. If your mental health affects your ability to work, this might also reduce your income and put more pressure on you.

We also know your financial situation can affect your mental health. Certain situations might trigger feelings of anxiety and panic. Worrying about money can lead to sleep problems. Money problems can affect your social life and relationships. You might feel lonely or isolated, or like you can’t afford to do the things you want to.

You don’t need to have significant debts for money to affect your mental health. We know all too well the vicious cycle of depression and debt. Nor are you guaranteed to be happy, just because you have money. Even for those who have money, the emotional connection to money, and the way you think about money, influences your decisions. And these could have huge impacts on your future state of mind.

You might feel guilty for spending money, even if you know you can afford it. Or, you might feel guilty for seeking support, even if you know you need it. You might feel stressed if you’re under a lot of pressure to support yourself and others. And worn down from working so hard to generate the income just to sustain your family. What is it all for?

Steve Jobs had money. “I reached the pinnacle of success in the business world. In others’ eyes, my life is the epitome of success. However, aside from work, I have little joy. In the end, wealth is only a fact of life that I am accustomed to. At this moment, lying on the sick bed and recalling my whole life, I realize that all the recognition and wealth that I took so much pride in, have paled and become meaningless in the face of impending death.”

OK so Steve Jobs is an extreme example, but a key question to ask is: What is it all for? Is it for your family’s security? Is it for charity and philanthropy? Is it for the biggest holiday of your life (AKA retirement)? And have you got a plan to get there? Is your plan balanced enough to allow you the flexibility to live a little?

You might find it helpful to take some time to think about how you feel about money and why. For example, if you’ve struggled with money in the past or didn’t have much money growing up, this might affect the way you feel about money now. You could try answering these questions:

• Are there certain times when you’re more likely to spend money?
• Are there certain times when you’re more likely to save money?
• How does it feel when you spend money?
• Do you feel differently when you’re spending and saving?
• What are the emotions and feelings you think of when you think about money?
• Which aspects of dealing with money make your mental health worse?

Once you’ve done this, you might start to feel like you understand your habits and patterns around money a bit more. Knowing these could help you plan ahead for difficult times.

Having plans give us structure and a framework to work within. We can allow flexibility, and allow ourselves to be human. Using trusted advisers who understand money but also the emotional impact of money is important to keeping balance. And remember, what one person does is not necessarily the same and what others should do. We are all individuals. We all have to find our own balance.

Let’s pick Lauren as an example. She is 35, married and is currently earning 100,000 CHF per year. She is pregnant and wants to understand how the 60% contract when she returns to work after maternity leave is going to impact her pension provision and associated benefits.

Current Situation:

She earns 100,000 CHF per year. The coordination deduction is currently 25,095 CHF (this reduction is to coordinate the first and second pillars) therefore the coordinated salary is:

• 100,000- 25,095 = 74,905 CHF

As she is 35, a minimum of 10% is paid into her second pillar therefore 7,490 CHF is being contributed on an annual basis.

60% Contract:

60,000 CHF earnings per year. Lets assume the coordination deduction hasn’t increased since she returned to work, therefore the coordinated salary is:

• 60,000 – 25,095 = 34,905 CHF

She is now 36 and still in the 10% category so 3,490 CHF is being contributed to her second pillar on an annual basis.

Impact:

Lauren’s Second Pillar Retirement Savings

Although Lauren has reduced her contract by 40%, her annual second pillar contributions have decreased by 53%.

Lauren’s Second Pillar Insurable Benefits:

Children’s disability pension, children’s orphans’ pension, Lauren’s disability pension and the survivor’s pension in place for her husband will all also decrease as these are based on the new coordinated salary.

What does this mean for her and her family?

Lauren will be the main carer for their child and if Lauren was to become sick or die the family would have less protection in place as this is calculated on the new lower figure under the new contract.

At a time when they need more protection in place, they will have less.

What can be done?

In Lauren’s case she started a third pillar with insurance to protect her family on her death. Now if she dies before retirement the family will receive a 200,000 CHF lump sum and she is using the savings provision to save for her own retirement in line with her attitude to risk.

Of course, if Lauren’s circumstances were different my recommendations could have also been different – but that’s the benefit of a financial review

When the pandemic first hit in 2020 and most of the world had accepted extensive use of masks I was slightly horrified by the amount of waste they produce. The image of a mountain of garbage in our oceans followed me around every time I went outside. As a responsible adult, I thought of what changes can I make to provide a bit of relief to the environment and reduce my own carbon footprint? As I looked around my own house, I noticed that my bathroom has quite a grand collection of plastic. The most-used material for shampoo bottles is HDPE (High density polyethylene) which is recyclable, but my closest recycling station only has a PET (Polyethylene terephthalate) bin making it harder for me to recycle. So I thought, there must be a better way to care for my hair while caring for the Earth at the same time, so I decided to switch to solid shampoo and conditioner.

Initially I was very happy with my choice. I got a few bars from local bio shops and a few more from well-known brands. Unfortunately, the solid hair care market is relatively new, so the options are limited compared to the thousands of traditional products. There are multiple benefits that I didn’t even realise, such as I didn’t have to worry when taking it on my travels as it didn’t take up so much space. Also, it seemed my hair reacted well to it as I now had more days in between the washes. It also built some new habits, such as buying some products in a refill system since I became a regular at a ‘green’ shop.

The problem arose towards the end of COVID measures. When it got safer to go to public places and see other people. To pick up my social appearance I found a hair stylist from a higher-end salon who works with my type of Asian hair regularly. This measure was necessary since the treatment I wanted is not very well known in Europe. I was born with naturally straight hair so to give it volume I spend hours styling it. The hair structure is very different to European hair so instead of getting them permed, I wanted to try a Korean perm which would create a soft big curve instead of a twingling shape. I booked an appointment 2 weeks in advance and travelled 2 hours to get to Aarau from Geneva. Upon arriving the hairstylist gave me a critical look but didn’t comment on the state of my hair. She then went on with the preparations of setting up the machine, giving me all kind of gowns and finished preparing by taking a ‘before’ picture. She worked on my hair for 6 hours all the while asking me all types of questions like if I spend a lot of time in the sun, how do I dry my hair and finally what shampoo am I using? By the time that question rolled in I felt too self-conscious to reveal that I use locally made hair soap, but she didn’t even wait for an answer “Your hair is too dry, it doesn’t retain moisture. You must change your products.” We then spoke about how to treat it: shampoo, conditioner, hair masks and oils. She asked me to send her a photo of the ingredients next time I go to buy my products so she can advise on whether it will suit me. After everything was done and I was putting on my coat something dawned on me – she never took an ‘after’ picture.

I was very disappointed that my efforts to save the planet resulted in dull hair and pitiful looks from hairdressers. The result of a 6-hour expensive procedure didn’t even deserve an Instagram story. As I was travelling back home, I contemplated whether I had really helped anything or was I trying to solve an environmental crisis with some nonsensical actions? In the end, I think my heart was in the right place: if there is a demand for more sustainable solutions then producers will adapt. These questions can and should be discussed on a greater scale. None of the big problems have easy solutions and people should be prepared to make greater sacrifices as no goal will be attained by small convenient solutions. A commitment, be it a shampoo change or a savings plan, should not be short-term. Nowadays I think about it often on my way to recycle the HDPE bottles and when checking my sustainable investments.

A friend from the next village was going away for a few months so was more than happy to ‘lend’ us the cat she had adopted from the local farm. In the end a few months became a few years and ‘Bugalugs’ as we named the wily, black and white farm cat successfully terrorised the resident mice until our house became an (almost) mice-free zone – apart from the mice that he actually brought into the house of course!

As Bugalugs had no pedigree and was ‘just’ a farm cat, he had no value as such and so we gave no thought to taking out any pet insurance. But as the years went by his sentimental value increased beyond all our expectations and when after 10 years he became very poorly and needed an operation we were faced with a difficult dilemma. The operation was going to cost a small fortune and that was without taking into account the expensive aftercare he would need. Having no pet insurance to fall back on we agreed to make financial sacrifices elsewhere and go ahead with the operation. Bugalugs pulled through but after running up some more hefty bills in aftercare he sadly passed away leaving us with a huge vet’s bill to pay and worst of all no cat to show for it!!

By this time we had two small children who although they were fond of Bugalugs seemed to accept his untimely demise with glee – ‘’Now we can get those kittens that I want’’ cried one of them. No-one knew which kittens this statement referred to – any kittens would do, the important thing was cute kittens rather than a rather ageing scraggy cat.

So back to the farm we went and returned with the requisite two cute kittens and once again the pet insurance question was raised and dismissed – ‘’They’re only farm cats, they’re not valuable enough to insure’’. How quickly we had forgotten the tugging at the heart strings dilemma we had faced when Bugalugs needed an expensive operation.

Fast forward a couple of years and the kittens are now two fully-grown, healthy cats. And whilst they keep the local mice population at bay we’re still spending a considerable sum on vet’s bills as their regular turf wars with the neighbourhood cats result in some serious battle wounds!

So, the question of pet insurance is back on the agenda and I’ve been researching options. One possibility is that Instead of taking out a specialist pet insurance we might set up our own ‘pet-fund’, putting aside a sum of money each month to cover those unforeseen vet bills. Whether you choose this option or the traditional pet insurance is up to you but when a friend adopted a new cat recently and asked me if I thought pet insurance was a good idea I said I thought it better to have something in place even if it’s ‘just’ a farm cat!