Wellness in any other area of life isn’t something that we would ever question – we take care of our physical health, our dietary health, and increasingly, our mental and relational health. Financial wellness is no less important in its own right, but also because it can positively or negatively affect every other part of our lives.
The outcomes of financial wellness look different to us all, but the strategy is the same: know what you have, work it in the best possible way to create the life you desire and then protect what you’ve worked so hard for.
Financial wellness means enjoying what you have today, planning for tomorrow, and protecting yourself and your loved ones for the future. Here are 5 steps you can take to start to gain Financial Wellness by financial services expert, Joanna Streames, the Founder and CEO of Velvet Mortgage and Insure Services.
- Don’t put it off another day – For most people they’re so overwhelmed by the products on the market and the jargon and language that it’s often easier to put it off for another day and think they will deal with it “tomorrow” or “next week” or “next month,” don’t put your head in the sand, start today by assessing your incomings and outgoings – understand your accounts and finances.
- Don’t be afraid to find out where you’re at, it is your reality, grasp it and understand it and then seek advice on what you can do to help yourself and your future – no matter what your financial circumstances hiding from it will not help. If you decide to take control from today, your financial wellness will start to improve and you will approach it from a place of understanding the reality of your situation and be able to take action as needed and seek appropriate advice to make things work better for you and your loved ones.
- Seek Sound financial advice – Most of us don’t think twice about seeing a dentist for a painful tooth, a solicitor when we’re buying a house or to handle a divorce. We turn to the experts, but there are still so many people who are in the dark about their finances and they don’t seek sound independent advice. A qualified financial advisor can help you unravel your finances so that you have enough for today with an eye on tomorrow so you don’t have to worry.
- There are people out there who are your kind of people, who you can connect with. People need good, uncomplicated, straightforward advice and someone to lead them through the best choices for them. Once there are some basics in place, you can relax, knowing you are doing the right things and an annual review or a small change might be all you need. Ask people you know and trust for recommendations as a start to finding the right adviser for you.
- Insure yourself – People often protect their pets more than they protect themselves and their family usually because the majority of us are blinded by financial science. You are your biggest asset and you can insure yourself for just a few pounds a week and create a replacement income if things go wrong. Most people think their biggest asset is their house but actually it’s their income.
- The average wage of £1,950 per month over your working life can add up to over £1M and that’s without factoring in a pay rise! You are your biggest asset, so make sure you look after yourself. If you had a cash machine in the corner pumping out a couple of thousand pounds notes per month you would soon insure it for breakdown so do the same for you’re money-making machine – you.
- Create a savings pot – It’s not glamorous and there are no instant rewards but you’ll be so glad you did. You can even get banking apps these days with ‘pots’ so that you can distribute your funds and see your savings grow. Savings can be for something specific, or for that ‘rainy’ day… this doesn’t need to be a large amount as you may want to invest larger savings but some easily accessible funds for emergencies is a must.
- Trusts and Wills – Put policies in Trust so your family get every single penny! Why don’t people know about this! Let’s reduce the taxman’s windfall and get people to know they can safeguard this, nobody wants HMRC being one of their beneficiaries. Make a Will People don’t realise the financial implications of not making a Will. This can potentially leaving a messy estate for a solicitor to have to sort out which will cost money, probably a lot of money, and this can take much needed cash and security from your family. These two things really are key and are the belts and braces of protecting yourself which people definitely do not realise. Paying the premium and setting up a policy is the first half but it shouldn’t stop there. Putting your policies in Trust and organising a Will really make the difference to the funds left and your family’s wellbeing after you’re gone by reducing stress at an already impossible time.
- Pensions! So many people haven’t started saving or investing for their own retirement, but it’s never too late. You can start saving today and make a huge difference for your future. Don’t bury your head in the sand! Make a plan, decide how much it’s going to cost you and starting putting money away in the same way you’d take care of any other commitment. Don’t gamble your future by not creating financial security.
- Educate your children! Financial education is key to financial wellbeing. Take time to talk about, and demonstrate, sound financial practice and then make it as easy as possible for children to manage and understand. Financial stress is a big factor in wellbeing, so if we have the tools from a young age surely things would improve all round.
The great thing to know is that you don’t have to have millions in the bank before creating a plan which ensures you and your loved ones are well taken care of. With good advice and a commitment to your planning, you can experience the peace that comes with knowing your finances are all in order and you are financially resilient – and this is true financial wellness!
