Financial Flourishing

Financial Flourishing

What are Financial Wellness and Financial Wellbeing? And when done well and in unison do they create something else?

I was asked recently to talk about Financial Wellness and Financial Wellbeing. What they look like and how they might be described. It dawned on me that it would make sense to put some of those thoughts here since the website, podcast and blog all use one of those terms!

Below are some quick thoughts on each and what I believe a good combination of the two will create.

Financial Wellness:

To start, lets talk about Financial Wellness. For me this has a lot to do with overall financial health. Are we doing the things we should be doing financially? These are financial tasks being completed, to-do's being checked off lists and strategies being implemented to grow wealth over time. Obvious examples are keeping track of your budget, contributing to 401k's regularly, paying your bills on time and in full every month, etc. It's financial baseline.

Ideally a lot of your financial wellness plan is automated. Saving happens without thought every paycheck, investments are made regularly and systematically to take advantage of dollar cost averaging and bills are put on auto pay.

But financial wellness also relates to the things that can feel somewhat tedious. Like are you opening your mail, electronically or OG postal service delivered? Seriously are you bothering to open those statements to see how things are going? You should be, at least once in a while. Are you ignoring that $25 co-pay invoice that's hanging around? You shouldn't be.

Building healthy financial habits and behaviors is an important part of financial health and a factor in contributing to your overall financial wellness. Its not just about saving and investing.

Financial Wellbeing:

Financial Wellbeing, on the other hand, has to do with how we feel about our finances and our financial lives. As I've talked about before on the "About" section of the website, wellbeing has more to do with who we are as people and the experiences we've had in the past than it does with whether or not we invest the right way.

Where we came from, who our parents were, the teachers and mentors we had along the way, experiences we've had both good and bad, books we read, the news and social media we consume on a daily basis all impact what we do with our money and the emotions involved along the way.  

Wellbeing can be tougher to measure and how each of us might report feeling about our financial lives might change from year to year. For that matter it can change month to month or sometimes even day to day depending on what's happening in our lives.

We need to make time to check in with ourselves and our emotions and be able to answer the question, "How do I feel about my financial situation?" We need to notice when we feel stressed, anxious and overwhelmed. And we need to put in some work in understanding where those emotions come from so we can start dealing with them.

And Financial Wellbeing isn't just about focusing on the negative. It's also helpful to be grateful for the things we have and celebrate "the wins" along the way large or small. So pat yourself on the back when you cancel that $15 subscription you don't use. Pause and reflect on how far you have come in your financial journey and the challenges that made you stronger along the way. Finally, take a minute to remember how lucky we all are to be alive, regardless of how chaotic life might be right now!

Can you have one without the other?:

If it's not obvious there tends to be a great deal of overlap between the concepts. They are inextricably linked.

Our financial habits, the things we do or don't do will of course impact how we are feeling and how we feel has a lot to do with what our balance sheet looks like or the bills piling up in the corner.

Here is another consideration. You CAN BE financially well off and be miserable. Conversely, you CAN ALSO BE financially unwell and feel content.

In fact I know many examples of both. I know and work with many people who are doing really well financially and feel unhappy. They are stressed, anxious, overworked and feeling overwhelmed. And more money isn't the solution to that problem.

I also know and work with many people are who just barely making it all work but by all measures would appear to be very happy. They have challenges and the future is less uncertain than they'd like it to be. But they feel grateful for the people in their lives, the opportunities and blessings they do have and are generally able to handle the stress and anxiety that can come along with the less than ideal financial situation they find themselves in.

Financial Wellness + Financial Wellbeing = Financial Flourishing:

So here's the deal, I believe that we NEED and CAN work on both at the same time. It may feel daunting to try to work on your financial tasks and improve you financial health while also working on being a better human. But it is possible.

For a while I have been thinking about the combination, Financial Wellness + Financial Wellbeing. Doing the best we can to manage the day to day and get things done while at the same time feeling good about it along the way. When both things are in focus and being worked on, invested in and getting better that is when we start to Flourish.

Just remember that it's a journey with no end point. These are things we'll be working on for rest of our lives. There will always be financial tasks and plans to manage, forever, like it or not. And unless Elon Musk makes us all cyborgs soon, we'll be humans for the rest of our lives. Crazy, messy, emotional humans.

So start small and give yourself a break if aren't where you want to be, yet.

Pick one thing to start with.

On episode 3 of the podcast we talked to Moira Somers, Ph.D. about getting financial tasks done and dealing with procrastination and overwhelm. To use her words,

"Nothing feels better than progress"

Financial Wellness - What's the one thing you can do right now to move the needle? Maybe it's increasing your 401k contribution. Maybe it's setting up your kid's 529 account (like you've been meaning to do since they were born). Maybe it's simply opening the stack of mail you've been avoiding.

Pick one thing to tackle and do it right now.

Financial Wellbeing - How do you feel about your finances right now? When asked that question did you feel any stress or anxiety? What might that be related to?

How do you feel overall? Not just about money, in general how do you feel? If you take a moment to pause and check in with yourself and find you feel "less than" in any area of your life take note and then start taking some action.

Meditate, start a gratitude practice, get a better night sleep tonight, call your financial advisor and get an update on how your retirement plan looks, schedule the therapy session you've been putting off, go for a walk. Whatever it is you are struggling with and causing you to feel stressed there are tools, resources and ideas out there that can start helping you feel better right now.

Just like measuring Financial Wellbeing, trying to improve it can be a little trickier. Because again it often has more to do with working on ourselves as humans, not the numbers that make up our financial lives. But if we don't put in some effort on other areas of our lives, we can never truly Flourish Financially.

So pick one thing and do it right now. Then make a plan to keep it as part of your routine for the near future.