Experts from a Latvian bank report: a study by researchers at Princeton University (USA), published in the scientific journal Science, showed that prolonged financial stress can reduce intelligence quotient (IQ) by as much as 13 points.
Daily worries about money not only exhaust but, as it turns out, can also reduce the ability to think clearly and rationally.
Experts from Luminor Bank report: a study by researchers at Princeton University (USA), published in the scientific journal Science, showed that prolonged financial stress can reduce intelligence quotient (IQ) by as much as 13 points.
The study notes that long-term financial stress and anxiety about money can subtly root themselves in everyday life. This affects not only emotions but also practical abilities: concentration worsens, thinking weakens, and solving everyday tasks—such as planning a personal budget, managing bills, or prioritizing finances—becomes more complicated. Over time, such a level of tension hinders making thoughtful and beneficial long-term decisions.
Financial Insecurity Affects a Wide Range of People
"Although it may seem that financial instability is characteristic only of people with low or irregular incomes, in reality, this feeling can affect much broader segments of society," the bank reports.
Even those who earn relatively well sometimes face situations where unforeseen expenses or weak budget control cause serious stress and internal tension. Financial stability is not just a specific amount in an account, but the confidence that a person can cover basic needs, handle unexpected expenses, and maintain a clear direction towards their goals.
The Path to Financial Stability
According to experts, the first step towards greater financial stability is to understand where and how money is spent each month. Even if it seems that funds are being spent only on essentials, a careful analysis of daily habits can reveal small but significant details that can substantially impact the budget over time. Simple changes—such as planning purchases or reviewing regular payments—help better control finances.
Equally important is to start building savings—even if it begins with a small "safety cushion" for unforeseen expenses. The key is to start: even 10 or 20 euros a month can be an important step towards greater stability and confidence in the future. Over time, this amount can be increased, aiming to create a reserve of at least three to four months' salary. The realization that a person has even a small buffer reduces anxiety, calms thoughts, and promotes thoughtful decision-making.
How to Reduce Stress
Research shows that people experiencing constant financial stress are more likely to make impulsive, emotional decisions—delaying monthly payments, making unnecessary purchases at inflated prices, or procrastinating.
