Key Takeaways:
- I believe better sleep (a component of a healthier lifestyle) and better personal finance are related.
- Sleep deprivation has become a badge of honor in American society, and it has severe consequences on health and wealth from personal experience.
- Prioritizing sleep could generate positive results across all aspects of life, including finances.
Sleep is for the weak. You’ll have time to rest when you’re dead. No one looks back on their life and remembers the nights they had plenty of sleep. These are a couple of examples of quotes, memes, and sayings with the implied message that sleep is overrated.
I lived that mantra. I prioritize everything ahead of sleep. I thought sleep is a waste of time — this type of lifestyle dominated for decades, resulting in undesirable habits.
On my self-improvement journey, I have come to understand that the impact of sleep deprivation is far-reaching. Chronic sleep deprivation and related habits hurt my finances.
Let’s take a look at the impact of chronic sleep deprivation, defined as consistently getting insufficient sleep (typically 7-8 hours a night), as it related to personal finance.
Here are some ways that sleep deprivation impacts finances.
- Impairs decision making and staying disciplined. It’s no secret that lack of sleep results in a clouded mind. Studies have demonstrated that sleep deprivation significantly increases human error. These judgment errors can add up, especially over time. For example, we make some simple mundane daily financial decisions, such as which credit card to use and how much to spend for meals. If we consistently losses out on 1% of the value daily, that could mean hundreds of dollars by the end of the year.
- Increases temptation of consumption. Sleep deprivation reduces inhibition and increases impulsiveness. A critical component of better financial health is spending discipline and keeping to a budget. Lack of sleep makes it easier to purchase that item you want but don’t need. Splurging and spending outside of the plan puts the whole budget at risk.
- Increases health and medical expenses. Lack of sleep has severe health consequences. It ages you. It gives your body insufficient time to recover. All of this results in a significantly impaired immune system and leads to more frequent illnesses. Illnesses result in economic loss in many ways, including time away from work and medical expenses.
- Decreases work productivity and performance. A clouded mind doesn’t help work performance. Poor work performance can mean it takes longer to achieve the next milestone for your business, that the next promotion or pay raise is further away, etc. If performing consistently in your business, job, and side hustles is important to you, sleeping well is necessary.
As you can see, sleep deprivation undermines efforts to improve one’s personal finance. Sleep is vital to wellbeing – physical, mental, and financial wellbeing.
So, how do you get better sleep? Here are some tips.
- Commit to a specific sleep schedule. Go to bed and wake up at around the same time every day (roughly an hour window), including weekends. This action helps the body associate a set schedule with rest and stabilize its natural rhythm (i.e., circadian rhythm).
- Optimize the sleep conditions. A cool, dark, and quiet environment helps the body enter and stay in sleep. Studies have shown that a room temperature of around 60 – 67 degrees Fahrenheit. Blocking out light and unwanted sound helps the body enter a calm state to induce sleep. There are special considerations to sound and its impact on sleep that’s worth exploring.
- Ramp down before sleep. Slowing activities down before sleep signals to the body that it’s the end of the day. Experts have recommended practicing mindfulness, listening to calming music, and reducing the use of electronics (e.g., phone) before sleep. The concept is to let the body and mind slow down.
- Limit caffeine and alcohol intake. Caffeine reduces sleepiness by blocking some sleep receptors. Those same sleep receptors are critical to entering sleep. Limit caffeine intake in the morning if possible, given caffeine’s long half-life (5-6 hours) in the human body. Alcohol is a sedative that shuts off brain activity. However, brain activity is an essential component of proper rest.
- Exercise during the day. While it’s unclear why exercise improves sleep quality, studies have shown that moderate physical activity (only 30 mins) helps decompress the mind, making it easier to enter sleep, and lengths deep restorative sleep, helping the body and mind to recover.
As you hustle to build the future you desire, it’s critical that you maintain proper sleep habits and hygiene. Sleep is our superpower that will make us even more successful.
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