Financial Wellness Meaning
Wondering about a financial wellness meaning? Ask people who don’t have it. They’ll tell you just how much financial wellness means. They’ll also tell you what it means to be financially unwell. Financial wellness means less stress and more security in life. Good financial health means higher self-esteem, which is beyond financial value. Financial wellness means having a healthy relationship with money. It means being money’s master and not its slave. It means being proud and excited about money instead of dreading the topic and wanting to throw up every time you think of it. Financial wellness is extremely important and financial literacy is the first step toward being financially healthy.
Financial Wellness Means Increased Self-Esteem
So what is financial wellness? Various financial wellness meanings relate the financial behavior of a person to the financial health of that individual. Often, financial wellness meanings explicitly build the link between financial education in the classroom and real-world decisions that lead to financial well-being. Companies that take notice of the financial wellness of their employees as well as improvements in morale and worker productivity. It is disappointing that our public education system cannot provide the same benefits to our students that large, profit-seeking corporations can provide to their workers.
Definitions of Financial Wellness
“Financial Wellness involves the process of learning how to successfully manage financial expenses” (UC Davis).
“Financial wellness is defined as “effectively managing your economic life” (Questis).
“Well-being is defined as having financial security and financial freedom of choice, in the present and in the future” (Consumer Financial Protection Bureau).
Meaningful Financial Wellness Programs Focus on Knowledge and Behavior
While the link between financial wellness and knowledge of personal finance is well established, the necessary step that many individuals gloss over is using that knowledge in their own lives. Only with application can the process of long term, healthy financial habit-building take place and prevent bad financial practices from creeping in. Keeping this in mind, concerned community citizens should ensure that the programs being implemented near them are focused on using the information towards the goal of improving personal financial wellness.
The Financial Literacy and Education Commission (FLEC) recommends that targeted materials and cogent dissemination strategies must be employed by programs to underrepresented subgroups in the population. Understanding the needs of low-income and minority communities is essential to produce relevant materials that can help ameliorate the problems brought on by poor financial practices (US Dept of the Treasury). https://www.treasury.gov
The Financial Services Authority (FSA) of the United Kingdom recommend the structure of the initiative involve creating working groups that yield considerable responsibility for each individual project. Working groups work closely with partners and stakeholders to craft the curriculum (Financial Services Authority). http://www.fsa.gov.uk
Researchers at NBER demonstrated the positive relation between the average stock market participation between the individual’s community and the individual’s participation rate in the markets. This effect was proven to be stronger in more sociable communities (National Bureau of Economic Research). http://www.nber.org
Financial Silence Might Mean Poor Financial Wellness
Bankrate.com conducted a survey showing that 41% of Generation Z, 38% of Millennials, 49% of Gen X, 53% of Boomers, and 59% of the Silent Generation feel uncomfortable talking about their credit card debt. As reported by Harvard Business Review’s Ascend
37% of recent college graduates have been late with a student loan payment at least once in the past year (US Financial Capability). http://www.usfinancialcapability.org
58% of 18-26 year olds set aside a portion of their income as savings (Bank of America). https://about.bankofamerica.com
A statistically significant association was determined between negative financial habits, such as gambling among Australian youth, and the influence of peers and parents (Science Direct). https://www.sciencedirect.com
“The number one problem in today’s generation and economy is the lack of financial literacy.” – Alan Greenspan, former Chairman of the Federal Reserve
“Without financial literacy, divorce rates soar, families rupture, and women stay with abusive men for financial security. A lack of jobs contributes to riots and illegal activity. Name any situation and it goes back to money. We need to focus on poverty eradication.” – John Hope Bryant, CEO of Operation HOPE
Financial Wellness Affects All Aspects of Life
Financial wellness meanings are increasingly used to describe the link between a person’s financial knowledge and their state of financial security. Corporations have issued their own financial wellness meanings internally and deliver financial wellness presentations to employees as part of the company’s wellness program key goals. Researchers are publishing more studies that link financial wellness programs not only to improved economic outcomes, but also to improved lifestyles and lower stress due to financial problems.