While it’s true that money isn’t everything, it also must be said that money has an impact on most if not all other aspects of our life. Financial well-being has measurable effects on our mental and physical health, relationships, professional health, and ability to relax. Toward that end, it’s vital that we all maintain some level of financial wellness both for the sake of our financial future and in order to get the most out of the rest of our lives. But what is financial wellness, what comprises it, and how do we build and maintain it?
Broadly speaking, there are three pillars of financial wellness, each of which works to support the whole. When taken into consideration, they help us develop a plan for overall financial wellness, our financial goals, and our futures:
- Control over daily finances and daily financial decisions is the first component of financial wellness. In turn, there are many aspects to this: control over daily spending, planning personal and household budgets, and making use of various tracking tools to understand, project, and control our spending and expenses. This helps us understand where the money goes and how we can get the most out of our income.
- Being financially prepared for emergencies is the second step towards financial wellness, and like the first step, it can take many forms. Emergencies may include unexpected yet critical expenses, sudden or unexpected unemployment, natural disasters, and reversals in the stock or housing markets may all constitute an emergency. By being financially prepared and having a financial buffer or emergency fund in place, we’ll be ready to meet these challenges head-on.
- The final component of financial wellness is planning for the future, which again takes many forms depending on your goals and needs. For some of us, this may involve asset acquisition and development. Others are focused on investment or retirement planning. The parents among us may place more importance on providing a future for their children. Everyone’s goals are unique, and your financial planning and resulting financial wellness should express this.
There’s more to money than money. Money is emotional, personal, and even familial. In building our financial futures and developing a healthy level of financial wellness, we are doing our best to live the life we’ve wanted in a healthy way. A recent survey by the American Psychological Association found that two-thirds of American adults say that their financial situation is a significant source of stress in their lives. For many of us, this is avoidable via careful planning and disciplined spending/investment designed to create a lasting state of financial wellness.
So what are the best ways to go about creating financial wellness? While good personal spending habits and living within your means are a great start, it is often helpful to have more guidance along the way. A financial professional who knows your situation and can work with you to illuminate the blind spots on your path to financial wellness and financial success can make all the difference. At OmniStar Financial, we’re here to provide just that. Get in touch today and let’s start building the financial wellness you need.