Financial wellness is an integral part of your overall well-being. No one likes the stress that accompanies the feeling of “scarcity”. Whether expressed openly or covertly, everyone desires financial stability and wellness.

In their 2019 annual survey on Employee Financial Wellness, PwC reported that 34% of employees surveyed defined financial wellness as “not being stressed about finances”. Another 18% defined it as being “debt free.”

But the road to financial wellness is not always clear.

This article recommends 7 important steps for you to take on your journey to financial wellness.

If you have spent most of your life in jobs that provided benefits, then you probably have the foundation for your financial wellness already in place. But, if that is not your reality and life has crept in and mudded your financial position, you can find your way to wellness.

7 Important Steps to Financial Wellness

Infographic: 7 Steps to Financial Wellness

1 Assess your current financial position and commit to change.

The primary reason for doing this is to remove all assumptions and build a plan based on facts. Sometimes the situation is not as grim as it seems o the surface. However, be mentally prepared, if the opposite applies. This is only the first step. The plan is to make things better than they are right now.

Once you have figured out your true financial situation, ask yourself the following questions:

• How will my life improve if I change my financial situation?
• Are the improvements worth my time and effort?

If you have a list from the first question and a “yes” for the second question, then its time to set goals and commit to the process of changing your situation.

“If you don’t know where you are going, any road will get you there!”

Lewis Carroll

2 Get Organized for Success

Many people shy away from the concept of getting organized because they don’t want the feeling of restriction that often comes along with it. The journey to financial wellness often means denying yourself on the front end for greater rewards in the future. Hopefully this is not the “too distant future”. To make sure of this, you need to set short-term SMART goals.

3 Create a financial wellness plan

Make a plan

Taking your SMART goals into consideration, design a plan that helps you achieve those goals. What actions will you take that will lead you towards the results you want to achieve? Be sure to include a caveat that addresses a “rainy day fund” for unexpected situations.

Create a budget

Creating a budget can be an arduous task for many, but in today’s world of technology, it can be easier than you think. While pencil and paper provide the advantage of seeing the details all at once, free apps can simplify the budgeting process. For effectiveness, a combination of both may be best. Write it all down first, then use an app (free or paid) to help you monitor your progress.

4 Take steps to secure your financial future

Track your expenses

You can also use a free app to help you track your expenses. Once you have identified your budget priorities and allocated funds to the various categories, you can use an app such as Goodbudget to help keep you from overspending. Goodbudget uses the concept of placing money into various envelopes marked for a particular expense.

Save where you can

In addition to saving a regular amount of your income (no matter how small), save wherever else you can.

Even if you live in a country where couponing is not a part of retail operations, you can still save on groceries and other household items. This is another area on your journey to financial wellness that requires discipline and commitment on your end. Without sacrificing quality, assess what you use, how you use it, what alternative uses exist and explore cheaper options.

Invest in your future.

While keeping your money in your bank account may seem like a safe and secure location, it is not likely to yield returns that will help secure your financial future. According to the World Bank, there are countries that offer high interest rates on deposit accounts, but if these are not the places in which you live, then a different approach is required.

Wherever you live, if you want to have money in your later years, then making your money work for you, is the reason why you need to invest. Investments in bonds, real estate or stocks will provide a higher rate of return than your savings account at your local bank.

Investing in your future does not have to be a daunting trail of terror. If you are just starting, it makes sense to start with a slow, sure investment that will help you build confidence in the process.

5 Self Audit – periodically check up on your financial status

It is a great practice to review your monthly bank statement to determine where and when money flows into the account and equally as important, when it gushes out. Such a practice will allow you to identify periodic charges you may have overlooked during your budgeting phase. It will also help you to identify incorrect charges and review recurring charges.

6 Make financial literacy a part of your personal development.

Unfortunately, so many persons around the world were raised with limiting beliefs about money and finance. After all, if your family never had a lot of money, you may not (for example) have learnt about the value of investments.

Today, with easy access to information, there is no excuse to remain clueless about finance and what you need to do to attain financial wellness.

A basic understanding of savings and investments, budgeting and financial instruments can be easily obtained online. Many banks offer similar information and learning experiences on their websites.

7 Rinse and Repeat

Wellness, be it physical, mental or financial, is an evolving state. For that reason you need to rinse and repeat. Start at the beginning and work the process all over again. This is how you will grow and how you will continue to experience financial wellness.