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Why do some people look on the bright side, while others always see the glass as half empty?

Valérie Legendre is a psychologist and senior mental health consultant at Sun Life. Valérie says: “Whether or not you’re an optimist depends on a number of factors. Things like your temperament, how you were raised and what kind of family you grew up in.”

Let’s say you grew up in a family that was anxious, negative and who always expected the worst case scenario. Then it’s probably harder for you to believe that things will eventually get better.

The good news is, optimism can be cultivated. We can all learn to believe in a brighter tomorrow.

What’s more, developing optimism can affect all areas of your life:

  • your good habits,
  • your ability to see your plans through,
  • your physical health,
  • your mental health and
  • even your financial health.

How does optimism lead to financial health?

A recent survey in the U.S. found that optimists were 7 times more likely to exhibit better financial health than pessimists. Now what do they mean when they say ‘financial health’? It refers to having good relationship with money. How people feel about it, rather than how much they have or how much they make.

Here’s a few of the questions they asked people in the survey:

  • Are you able to make ends meet?
  • Do you have financial goals and are you on track to meet them?
  • Do you have an emergency fund?
  • Does your budget allow for life’s pleasures, things like going out for dinner or travelling?

Answers to these questions demonstrate the way optimists better relate to money.  The survey also shed light on three key habits optimists engage in to improve their financial wellbeing and to reduce money related stresses.

They discuss finances with family, friends or an advisor.

Optimists do not believe talking about money is taboo. 76% of respondents classified as optimistic said they feel comfortable discussing money with family and friends, compared to 53% of pessimists.

Optimists are also more likely to seek out and follow the advice of a financial advisor. And of those who got help from investment advisors, 63% of optimistic respondents reported following their advice always or most of the time. This figure fell to 40% among pessimists.

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They make progress with small, realistic goals. 

Optimists see value in making progress toward a goal in small increments. For example, that might mean saving a little bit at a time, even just $10 to put toward a future purchase.

They learn from financial setbacks and bounce back. 

The optimists surveyed were not immune from financial challenges. Far from it. But they were more likely than pessimists to learn from their setbacks.

Marie-Ève Poulin is the Director of Recruiting at Sun Life, and it is her job to ensure advisors have the tools required to meet their Clients’ individual needs.

“Among our core values, we always stress that no one is immune from a financial setback,” says Poulin. “And more importantly, that a bad financial situation now does not necessarily mean a bad financial future. Anyone can adopt better behaviours and have a more optimistic attitude toward their finances.”

Do you want to become more optimistic?

Here are 5 simple ways toward a brighter outlook.

Number 1: Become aware of what’s holding you back. 

Do a little self-evaluation and reflection. What are the limiting thoughts that dominate your self-talk? Identify the negative thoughts like “I’ll never be able to get out or debt,” or, “it’s impossible for me, but not for others.” These thoughts will prevent you from focusing on the positive.

Number 2: Choose to change and set goals.

Yes, you have to make a deliberate choice to be more optimistic. It’s the same way you would decide to be more active or to quit a bad habit. You do this by setting a specific goal for yourself.

For example, let’s say your goal is to pay off your debt.  Think about why that is important to you. The answer will help you stay on track when obstacles or temptations pop up. The next time you feel the urge to make an impulse purchase, ask yourself if that purchase will help you achieve your goal. A clear objective will help your stay on course!

Number 3: Make a plan.

Your goal will seem far more realistic and attainable if you are clear on what you want and how to get there. Take small achievable steps. Each step, or sub-goal, you meet will feel like a victory! Those wins act as positive reinforcement and will trigger a feeling of optimism. You’ll feel motivated to keep going!

Number 4: Celebrate and take credit for your achievements – both big and small.

Optimists feel that they’re responsible for their success. However, pessimists would say it was just good luck or a coincidence. The trick here is to have a ritual around recognition. It’s a good way to develop your optimism, and it’s great for your morale and your mental health.

It could be something as simple as taking a few moments at the end of each day to look back on your small wins. For example, you might say, “Today I succeeded in staying within my budget. I resisted that impulse purchase that would have derailed me”.

Remember to revisit these achievements when you’re experiencing a setback or are feeling discouraged. You’ll feel motivated once again, by thinking back to your accomplishments!

Number 5: Frame your goals in a positive way.

Have a concrete goal to aim for, preferably one that you are excited about. For example, your goal may be to put away five thousand dollars in your tax-free savings account (TSFA) for a family vacation. You’ll find it is a lot easier to stay on track when you are clear about what you want. It’s harder to stay motivated if there is no clear reward attached to the goal. For example, the idea of a super tight budget isn’t motivating, but going on a super tight budget so you can take the family on a trip is!