For me, wellness first popped up in nursing school over 30 years ago, defined by the World Health Organization as “…a state of complete physical, mental, and social well-being, and not merely the absence of disease or infirmity.”
Wellness and balance are used a lot these days and some purport that wellness is multi-dimensional, with sub-dimensions of Social, Occupational, Spiritual, Physical, Intellectual, Emotional, Environmental, Financial, Mental and Medical Wellness.
The truth is wellness is a tough word to define.
But in simple terms, financial wellness typically means: you can manage your day-to-day financial life, you can absorb a financial shock and you’re on track to meet your financial goals.
Here are some stats:
70% of Americans live paycheck to paycheck with no regular savings goals. CNN Money 2013
52% of Americans have less than $10,000 saved for retirement. That is, very few Americans have the savings they need to live comfortably well into retirement. USA Today 2014*
64% of Americans can’t cover a $1,000 emergency. That is, the majority of Americans can’t cover a $1,000 emergency without borrowing money, making every unexpected expense a crisis. Market Watch 2015*
Here are 4 simple truths:
- Improvement is always possible
- Continuously seek more information about how you can improve.
- Consider a variety of options and select those in your best interest.
- Success is determined by each individual to be their own collection of life accomplishments.
Overall, wellness is an active process of becoming aware of and making choices toward a more successful existence.
I read recently that there are 5 stages on the road to Financial Wellness…. and wellness occurs as you progress from financial literacy to financial freedom.
You’re probably familiar with these terms:
Financial literacy – understanding the basics of personal finance, banking terms, and how money works. At this stage you can answer questions like: how does compound interest work? what is a checking account? do you know the difference between a credit report and a credit score? why contribute to a 401(k) plan?
Financial capability – knowledgeable and capable to make better decisions with your money. At this stage, you can answer questions like: where do you bank? what’s your credit score? why do you save money? how do spend?
Financial security – when your income is enough to cover your monthly expenses and debt obligations well into the future. At this stage 3, you can answer questions like: what’s your budgeting method? what’s your net worth? how much is in your emergency fund? what’s your debt-to-income ratio? What’s your savings rate?
Financial independence – when you have enough money to cover your basic needs and some luxuries too. At this stage, you can answer questions like: explain the 4% rule? what’s your retirement withdrawal rate? how much money do you have saved? how much is your savings earning? did you factor inflation?
Financial freedom – when you can live how you want without the trappings of financial worries. You’re living the life on your terms.
So….
Which stage are you?
Do you have plans in place to help you move to the next stage?
Financial wellness is a process and will look different for everyone. Some days may even look different from others, but stay focus and continuously pursue your financial wellness goals.
The knowledge and ability to face financial issues with confidence coupled with better money management and planning can lessen financial stress and its impact on your health!
I look forward to hearing from you!!
If you found value, please feel free to share!!!
Until next time…..
Althea
PS. I’ve partnered with a leading financial service company and the number one thing they do is credit restoration. We’ve helped many people since I started on this journey and always looking to serve more. Check out this short VIDEO to LEARN more. https://altheamcleish.lpages.co/ncs-video-download/
PPS. If you’re open to taking a look at an opportunity that can create a passive income for you with minimal time commitment, then Connect with me and I’ll give you the whole scoop!!
