New Study Suggests DFW Residents Can Save Money By Activating Emotions. Here’s How.

We are so excited to discuss two of our passions: saving money and research! Yes, as college professors, we love research.  Research that helps you save money is just what we need!  We're also excited to partner with Capital One to bring you this post!

Study Background

Previous research has shown that memories can be so vivid it’s like experiencing the event again, and remembering an event, a situation, or a person can evoke a shiver of excitement, the heat of anger, or the anguish of grief. Although emotion that is activated by a memory may not be felt as intensely as the actual experience, the recall can be enjoyable or painful nonetheless. Emotional memory adds credibility to the notion that thoughts can trigger emotion just as the activation of emotion can create cognitions. One of the areas of the brain that is involved in memory processing – the amygdala – also plays a role in emotional reactions and decision making. This research led Capital One to explore the power that emotion might have on financial decision-making.

Capital One and Financial Psychologist Dr. Brad Klontz of Creighton University sought to test whether positive memories tied to sentimental items, thus powerful and vivid memories, could be harnessed to improve financial decision-making – or, more specifically, savings behavior. The Banking Reimagined Savings Study, sponsored by Capital One and led by Dr. Klontz, randomly assigned participants to one of two groups – the control group or the sentimental item group – and compared the results of the two groups. The control group received a standard financial education presentation (FE) without any emotional engagement. The sentimental item group (SI) experienced an immersive positive emotion-based presentation and exercises revolving around the sentimental item they were asked to bring with them to the study.

What They Found

  • The sentimental item group increased their savings three times (67%) more than the control group (only 22%) as reported in the follow-up phase.
  • Participants assigned to the sentimental item group almost doubled what they save on average per year at $10,020 compared to $5,838 prior to the study.
  • Across all five cities, the sentimental item group reported increased savings that were substantially higher than the control group as reported in the follow-up phase:
    • Boston: 75% increase
    • Austin: 40% increase
    • Seattle: 47% increase
    • Atlanta: 137% increase
    • Dallas: 115% increase
  • The sentimental item group showed statistically significant increases in their financial savings behaviors from pre-experiment to post-experiment: readiness to save, confidence toward saving and financial health.
    • Readiness to Save: The sentimental item group’s readiness to save increased three times more compared to the control group
    • Confidence in Ability to Save More: The sentimental group’s confidence in their ability to save increased twice as much as the control group
    • Financial Health: The sentimental group’s reported financial health increased four times more than the control group

Capital One Confidential

  • The sentimental item group reported that they were more significantly emotionally attached (10%) to their sentimental item from pre-experiment to post-experiment, an effect needed to change behavior from post- experiment to the follow-up phase.

What This Means

  1. The researchers hypothesize that the sentimental items group were able, through positive, emotionally-charged memories, to develop a deeper emotional incentive for saving money. The exercises they engaged in may have enabled them to more viscerally relate saving money to the family, life values and goals that mean the most to them.
  2. By incorporating sentiment and savings experiences into financial planning -- workshops, money coaching conversations, or even self-directed processes -- It may be possible to successfully harness a person’s emotions in order to facilitate better and healthier financial decision-making.

What You Can Do – Tips and Tricks

Most of our financial decisions are not made by our rational brain. They are made by our emotional brain – and our emotional brains are not motivated by numbers or facts. We must engage our emotional brain if we want to change our financial behaviors.

Based on the Banking Reimagined Savings Study results, people might be able to try some of the same exercises the sentimental item group experienced in the study to improve their own savings behavior.
  • Harness the positive emotion tied to your own sentimental items to improve your savings behavior.
    • Think of an item you’ve kept for positive sentimental reasons and ask yourself what kind of feelings and values are associated with that item. Is it something a grandparent or parent gave you and thus is tied to the importance of a loving and supportive family? Or is it something from a vacation abroad that serves as a reminder of a sense of adventure and the great experiences you were lucky to have and that you hope to have more of in the future? Use the power of emotion tied to your sentimental item and the identified feelings and values associated to determine how to live your values today and improve your financial savings behavior.
  • Come up with an exciting vision of what you are saving for and ask yourself the following questions:
    • What would saving for the future get you? What is it you truly want? Get specific. What does it look like? How would it feel to have it? Who might you be enjoy it with? Where are you? What do you see, feel, experience?
    • Consider creating some visual motivators. For example, cut out a picture from a magazine depicting your goal and tape it to your mirror. Better yet, put a picture depicting your goal as your screensaver or smartphone wallpaper where you can see it several times a day.
  • Get specific. Don’t just have a “savings account.” Name it. Have a “2018 European Family Vacation Account.”
  • When you are motivated to take action, automate it!
    • For example, set up a monthly payment from your checking account to your savings account, like Capital One’s 360 Savings, so you never have to think about saving for the goal again. Make it easy to keep on track.
Capital One hosted National Savings Day and officially launched #ShareMySave on October 12 to spark a two-way dialogue around the topic of saving, help propel people to their money goals and celebrate individuals who value the act of saving.

We often think saving is hard. But the truth is, most of us have been saving for years. Look around at the stuff that you treasure in your home.

Maybe there’s a box of old love letters from your great grandparents. The toy robot you played with 40 years ago. Perhaps an elaborate sculpture you made in middle school—even though it’s broken. Here's a keepsake for our family:

Shapes and Counting Toy

We hang onto these things because they have meaning. Well, now we want to take those stuff-saving habits, and turn them into money-saving habits.

In fact, Capital One is honoring the need to save – and our innate emotional drive to do so. To celebrate, we’re holding a social media contest to promote the importance of saving and people’s capacity to do so.

Capital One is launching #ShareMySave – a celebratory contest that calls on Boston, Austin, Seattle, Dallas and Atlanta residents to share images of their most treasured keepsakes and what they are saving towards for a chance to win monetary prizes up to $10,000.
  • Share a photo of a treasured keepsake you've saved, and tell why it's special. Follow @CapitalOne and post it on Twitter or Instagram using #ShareMySave and #Contest for a chance to win weekly cash prizes of $500 or one of their $10,000 grand prizes.
And don't forget to visit capitalonesharemysave.com!

This post contains affiliate links to help you build your shopping list and travel list for your family. We are passionate about the product and the experiences listed in this post, but we also wanted to provide easy links you can click to purchase products for your busy lifestyle.

Thank you Capital One for sponsoring this post! This is a paid endorsement. All opinions are my own and were not directed by Capital One.  To learn more about Capital One, visit www.capitalone.com.

This week,

Have a great week and plan for the weekend!

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About Weekends Count - Weekends Count is a Millennial Family Travel, Fun, Food and Activities blog based in the Dallas-Fort Worth area in Texas. We review hotels, travel and household items, and millennial family experiences!

Authors - Jennifer and Tony Edwards

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