Financial well-being is an important part of a happy and fulfilling life, yet it’s something that many of us struggle to maintain.
Money issues can introduce significant stress on individuals and families, leading to physical health problems, social distress, and overall financial instability.
It’s not just the amount of money you have that dictates your financial well-being. It is a combination of factors such as socio-economic circumstances, behaviours and attitudes towards money that can impact our security for today and into retirement. In this blog post we explore the concept of financial well-being and how translates to other areas of life, including time with family, relationships and stress levels.
Financial well-being is a way to measure how you feel about your financial security.
Let’s start by asking:
- Do you have concerns about your day-to-day spending?
- Do you still have funds remaining after your bills, mortgage repayments, and regular day-to-day expenses?
- Do you have rainy day funds?
- How long could you continue your lifestyle if your regular source of income was removed?
- Could you handle a large or unexpected expense?
- Are you confident that you can reach your long-term goals?
- Are you on the path to create the retirement that you want?
Despite differences in individual financial goals, circumstances and lifestyles, the feeling of stress brought on by a lack of clarity and insecurity about your financial position is something almost everyone can relate to.
While there isn’t necessarily one definitive measure for gauging our overall well-being when it comes to money matters, being mindful of these key questions can help us take control back into our own hands.
The last few years have really tested our financial resilience. The economic impact of the COVID pandemic has been far-reaching, and its effects on long-term savings are no exception. An estimated $38 billion* was withdrawn out of superannuation funds, with over a million people emptying their entire retirement nest egg – potentially leaving them unable to meet future financial needs later down the track. This could lead to an alarming gap in the future when it comes time for Australians looking towards retirement planning.
Our finances can be affected by the unpredictable – from pandemics to economic shifts. But we do have control over how prepared and resilient we remain in such circumstances. Achieving financial resilience means you’re equipped to weather the storms of life, whether that’s a global pandemic or anything else.
This resilience is a core factor in understanding your financial wellness. By having the capacity to take on unexpected expenses, you can build your resilience and reduce the stress caused by financial uncertainty – all important aspects of your overall well-being!
In fact, your financial well-being is considered one of the eight vital elements for overall well-being. The well-being wheel helps us to understand the areas of our life that are going well and what may need improvement. The dimensions are interconnected and important to a well-rounded and balanced lifestyle. If you look at the well-being wheel below, are there areas that you feel are out of balance?
Achieving financial freedom can be a powerful way to live the life you always dreamed of. Confidence in your short-term finances is an essential part of building toward long term dreams, such as having more time for family or going on that once-in-a lifetime vacation.
Establishing clear goals and creating a roadmap towards success helps keep these aspirations within reach – even if unexpected setbacks arise along the way. Financial well-being has positive benefits far beyond money matters!
From reducing debt to planning for retirement, financial well-being is a personal journey and it’s important to find the path that works for you.
If the thought of meeting with financial adviser is intimidating, remember that our job is just to help you make informed decisions about your finances and support you to map and reach your financial goals.
We’ll provide objective advice, to ensure your choices about how best to use your money, are still yours. We’ll equip you with a roadmap for meeting any goals along the way. Plus our guidance will keep you accountable – giving structure, support and peace of mind when it comes to providing clarity and certainty around your financial future.