The best advice anyone ever gave us was to plan our next holiday while still enjoying the current one. The reason is simple: we tend to think more clearly and more broadly when we’re relaxed and in a good mood.
That’s on our minds because spring is here. The days are longer, the sun has some warmth in it, and it’s not yet the punishing heat of January.
What sunshine does to our thinking
There’s a surprising amount of research on how weather affects mood, and how mood affects decisions.
The best-known finance example is a study by David Hirshleifer and Tyler Shumway. They compared morning sunshine in the city of each country’s main stock exchange with daily market returns across 26 countries from 1982 to 1997, and found sunshine was strongly correlated with stock returns. The authors also found that fairly modest trading costs eliminate the gains from weather-based strategies. So please don’t plan your portfolio around the forecast. The point is that mood quietly shapes money decisions, even among professionals. You can read the study in the Journal of Finance.
A second study, published in Psychological Science, explains why we prefer spring for this kind of thinking. Across three studies with 605 participants in total, pleasant weather was linked to better mood, better memory and a “broader” way of thinking during spring, as time outdoors increased. The same pattern wasn’t seen at other times of year, and hotter weather in summer was linked to lower mood. That fits our own experience: warm enough to lift the spirits, not yet hot enough to wear us out.
The detail we like most is that participants needed to spend at least 30 minutes outside in warm, sunny weather to get the benefit. Sitting inside and admiring the view doesn’t count.
One caution. A good mood is great for stepping back and seeing the whole picture, but it can also make us a little too optimistic. The aim isn’t to make big financial decisions on a whim because the sun is out. It’s to use a clear, positive headspace to ask good questions, then make considered decisions with good information.
Financial planning is bigger than you think
Financial planning isn’t only about insurance and where your super is invested. It covers every part of your life that affects, or is affected by, your finances:
- Whether and when to work, cut back or retire
- Where to live, and with whom
- Marriage, kids, school choices and separation
- When to buy a car, sell the boat or join the gym
- Where to go on your next holiday (yes, that’s a financial decision too)
These are the decisions that benefit from a clear head and a good understanding of your finances.
Six spring questions worth asking
With more than eight months of the financial year still to run, now is a good time to think about:
- Where are you heading? What does a good life look like in 1, 5 and 20 years, and is your money set up to support it?
- Is your super working hard enough? Check your investment option, fees and insurance. The general concessional contributions cap is $32,500 from 1 July 2026, and if your total super balance was under $500,000 at the previous 30 June, you may be able to use unused cap amounts from the previous five years. Also, under Payday Super, employers must pay super guarantee for each payday from 1 July 2026, so contributions should now arrive with every pay rather than quarterly. It’s worth checking that they do.
- What can you do before 30 June? Tax planning is far easier with eight months to run than with eight days.
- Is your protection still right? Life, total & permanent disability and income protection cover, your will, enduring powers of attorney and your super beneficiary nominations should reflect your life as it is now.
- What’s changed? A new job, a new baby, an inheritance, a relationship change or a move can all shift your plan.
- How do you feel about your money? If the honest answer is “not sure”, that’s usually the best reason to start the conversation.
How to make your thinking time count
- Take it outside. Take a 30-minute walk with your questions.
- Write the questions down so you can bring them to a meeting.
- Gather your paperwork: recent super statements, insurance policies, your latest tax return and your will.
- Sleep on the big decisions. Let the good mood open up your options, then check them with a clear head and good advice.
Make some time to think
This spring, carve out some time for thinking. Better still, give us a call and book a time to come in for a chat. We’ll look at the obvious and not-so-obvious parts of your plan, and help you think as broadly as possible so your money works for you, not the other way around.
And we’ll do our very best to make sure the sun is shining on the day you visit.
