Finance is in divorce are often the thing that keeps us up at night, find out how to gain financial wellbeing and take care of yourself.
What Is Financial Wellness?
In response to the current economic climate it is no surprise that financial wellness has been a hot topic for individuals and institutions. With the reduction of savings rates, inflation concerns, job losses and turbulent market conditions for both property and stock markets around the world the onus is now placed on the individual to try to navigate these uncertain waters. It is never too late to start or amend new habits and money management is a lifelong skill that will enable you the freedom to make sound financial decisions.
To achieve financial wellness in your life it requires you to manage your money, consider your values, set goals for yourself, and live below your means.
Financial wellbeing includes the ability to:
Cashflow is the most important element to a healthy financial life.
The financial industry can be incredibly intimidating and seemingly complex from the outside. Building your knowledge of how the systems work and becoming familiar with the terminology will not only increase your feelings of confidence and control but allow you to engage and take ownership of your decision making processes when it comes to your financial wellness.
Complex decision-making around credit cards, mortgages, taking out and repaying loans, investment and planning will be less stressful once you can navigate the jargon. Check out our supplementary resources guide to find out more. (attached/download)
We all have our own individual financial story, habits or behaviours that we have inherited from our families, peers and society. By generating self-awareness over the triggers and responses that we hold subconsciously with money we can learn to build healthier habits and control our responses and put systems in place that benefit, not hinder, our progress.
Some questions you might like to ask yourself may include:
Budgets vs Money
A budget is a process and not a static document. Budgets can be boring. But everyone has one. Some are just larger than others.
By reframing Budgets as a ‘map of expenditures’—a balance of wants and needs, income and expenses, and a present and future financial lifestyle it will help you to identify your priorities and habits.
When expenditures are tracked, they reveal how money was spent. Without reflecting on your current habits there is a likelihood of a similar pattern of future expenditures.
Budgets are the scene and money is the character, facilitating the interchange between desire and action.
Creating a Budget
If you’ve never used a financial system before then take your time to try one. Habit building should be a way to bring harmony to your life so if something isn’t working – try something else. Only you will know how to manage your own emotions and personality.
To start with identify your ‘non-negotiables’ i.e. your fixed costs per month. Then your discretionary spending, then your future goals or investment amounts. This, ideally, should come to less than your income each month. Identify where you can channel your money to bring you the greatest sense of calm and control.
Creating a budget is a key goal of any financial plan When knitted together, the joint budget represents the fabric of family rules, stories, and rituals. Keeping track of emotions is the trickiest part when attempting to stick to a budget.
Working with a financial coach can help you remove emotion from your spending, and identify your values and priorities by providing an impartial and unbiased view of your current and future position.
Managing Impulsive Spending
Identify the emotional root of what’s causing you to shop, modify your behaviour when you know what the trigger is and try to replace it with an alternative activity, such as:
meditation, talking to a friend, watching a film, reading a book or something that will hopefully provide you with greater long-term satisfaction
Calculate how much you earn an hour (after taxes). If something costs £100, then this translates to 2 hours of your time. Then ask the question – is this worth x hours of your time?
Organising your financial calendar
A sound financial framework is essential for keeping on track with your day to day money management. This might include:
Eight things you can do to check in on your finances by the end of the year:
If you follow these tips and this guidance you will be well on your way to starting to sort out your financial well-being and safeguarding your finances.
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