By Brett Garlick | Published March 15, 2023
As a Human Resources professional, I’m always concerned for my employees’ and customers’ overall ‘Wellness’. It makes sense when thinking about wellness that you would consider your physical wellness, or even mental or emotional wellness. However, not many people think of Financial Wellness when considering overall wellness.
Financial wellness is your ability to live within your means and manage your money in a way that gives you peace of mind. Financial wellness is a key component of your overall wellness, and the lack of financial wellness can create stress and anxiety which in turn may impact your physical, mental, or emotional wellness.
Here are a few questions you can ask yourself to determine if you are ‘financially well’.
- Do you have a budget? Is it documented? Do you update it regularly? You need to know what you’re spending money on and how you can do it wisely. A budget gives you the control and freedom over your finances because you know what you need for expenses and what you have left to enjoy.
- Are you saving for the future? Do you have a ‘rainy day’ fund that you can use in case of an emergency? Ideally set aside 3–6 months of expenses, but that’s not realistic for many of us, especially given our current economic obstacles. Therefore, saving just one month of expenses is easier to do yet still makes a big difference.
- Are you saving money consistently? Get in the habit of “mindlessly” setting aside a modest amount of money. Set up an automatic monthly withdrawal from your checking to savings. You won’t have to think about it, yet it adds up handsomely over time.
- Do you have a 401k with your employer or have you setup an IRA with your financial institution to save for retirement? (First Community Bank can help you set up an IRA if you don’t have one.) It has been said that the best time to plant a tree is 20 years ago, or today. Setting up a retirement account when you’re young will ensure you have a sufficient nest egg when you really do start thinking about retirement.
- Are you saving money for your children’s education? Do you have a 529 Plan? Whether you have young children now or plan to in the future, opening a 529 savings plan is a smart move. You’ll grow your money tax-free, and it will help pay future tuition costs.
- Do I know my credit score? Get in the habit of checking your credit score and credit report on an annual basis to make sure it is error-free.
Spoiler: This is going to take some effort (as anything worth doing does). Self-care means eating your vegetables and doing your laundry, not just bubble baths and five-hour binges of “The Great British Bake Off.” You’re going to need to set aside some time to establish your foundation and build a plan you’re excited about following. And those bad old habits? They aren’t about to go down without a fight, so getting good at positive self-talk (among other things) is going to be key over the long term.
We don’t talk enough about finances in our overall wellness plans. The idea that when you have a handle on your finances, know what to do next to achieve your goals, take those steps, and regularly practice good money habits (aka financial self-care), you’re more likely to feel confident about where you are and where you are going – your quality of life improves and you add to your overall ‘Wellness’ - which leads to a healthy relationship with not only your money, but also your own ability to manage it.