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This mental shift helps you achieve money goals and reduce stress, says happiness researcher

Michelle Gielan
Michelle Gielan is a researcher studying the link between happiness and success.
Courtesy Michelle Gielan

As a young, working professional just out of college, I was constantly stressed about money. I lived in a shoebox, shared a bathroom with 10 other people in a dorm-style house, and window-shopped only. That was, until the day I realized I had a choice. I could stay stuck worrying about every penny or take meaningful action to change my circumstances.

When I was 24, I opened a savings account and committed to putting at least $5 dollars a week in it. After a year, I had saved $843, enough to fly home for the holidays and then go on a road trip with friends. That simple action changed the trajectory of my life. I saw that account grow and felt the rush of a financial win.

Now as a happiness researcher, I better understand how our mindset greatly affects our entire financial picture, and the simple positive behaviors that can turn our mindset around. I recently partnered with Frost Bank on a research initiative to explore the connection between our mindset and our money. We surveyed more 2,000 people across the country and the results uncovered a surprising key to cultivating financial well-being: optimism.

We found that optimism is directly connected to better financial health. Optimists are seven times more likely to experience high levels of financial well-being than pessimists, and are also more likely to meet their money goals.

Optimists are seven times more likely to experience high levels of financial well-being than pessimists.
Michelle Gielan
Happiness researcher

Nearly 70% of optimists reported that they implemented improved financial habits after experiencing a setback, compared to 36% of pessimists who said the same.

They feel better about their money, no matter how much they have in the bank, and are significantly more likely to make positive financial decisions. Our study found pessimists spend an average of 226 days a year dealing with financial stress. The optimists reported an average of 81 days stressing about money. That's a difference of almost five months.

You don't need to have been born a Pollyanna to benefit, though. There are ways to change your attitude when and where it counts. Research shows anyone can learn to be more optimistic simply by embracing the financial habits of optimists.

Optimism can be learned

You might ask: Isn't optimism naïve? Or, how can I develop a "glass-half-full" kind of optimistic approach to money when my finances are a mess?

In our research, optimism is defined as the expectation that good things will happen and the belief that our behavior matters, especially in the face of challenges. Optimists believe that they can change the course of their financial future by making things happen. It's another way of believing in yourself and believing that your actions matter.

Every time I deposited $5 into the savings account, I reminded my brain that my behavior makes a difference, and it spurred me to want to do more.

Here are the top three positive behaviors that help optimists and that could help you too.

Have meaningful conversations about money

Our research found that 76 percent of optimists are more comfortable talking about money. They're also more likely to seek and then follow advice from financial experts. Identify one or two people you trust and open conversations about your financial life with them.

This can be a savvy friend or family member who can walk you through how they made their big money decisions, or a financial advisor with fiduciary responsibility.

Be honest about your goals, the tools that you are using to hold yourself accountable, and the things that might be holding you back. Be open to advice and new ideas.

Seek progress, not perfection

Optimists find their confidence in progress — making and celebrating progress in small increments can make you more successful at meeting goals. To put this mindset into practice, take the positive habit of starting a savings account one step further — name it for a savings goal ("Hawaii trip" or "new car"), and set up an auto-transfer for a small amount each week. Celebrate your progress every few months as you get closer to your goal.

Remember that you don't need to wait for a perfect financial plan to get started. Even if you begin by setting aside $5 or $10 dollars every week, those small steps can make a big difference over time.

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Turn setbacks into strength

Everyone faces setbacks. Optimists cite an average of four in their lives at the time of our survey. The difference is just in how they handle them. Optimists are more likely than pessimists to have recovered and learned from their setbacks.

In fact, learning from mistakes fuels optimists' persistence and willingness to get back up and try again.

Make a list of the three most stressful events from your life and one positive thing you learned from each. The next time you feel stressed, reflect how you've grown as a result of those challenges. And when it comes to your money, think in terms of rational optimism. You can prepare for pitfalls by contributing to an emergency fund well before you need it.

As a positive psychology researcher, I've seen firsthand the benefits of choosing to practice optimism, not just financially, but in all aspects of life. Remind your brain today of the amazing things in your life and the ways in which your behavior matters. That fuel could give you back five stress-free months each year.

Michelle Gielan has spent the past decade researching the link between happiness and success. She is the bestselling author of "Broadcasting Happiness: The Science of Igniting and Sustaining Positive Change" and was named one of the Top 10 authors on resilience by the Harvard Business Review. Michelle is an executive producer of "The Happiness Advantage" on PBS and a featured professor in Oprah's Happiness course. She formerly served as anchor of "The CBS Morning News," and her research has received attention from dozens of media outlets including The Washington Post, Forbes, and The New York Times.

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