11 Key Financial Wellness Tips Everyone Needs

Financial wellness

According to this study from the American Institute of Stress, 62% of Americans feel stressed about money on a regular basis. The good news is you can combat stress by improving your financial wellness. Whether you are facing financial hardship or not, it's essential to keep your finances healthy!

In this article, I'm sharing some tips for financial wellness that everyone can benefit from! But first, let's go over what financial wellness really is.

What is financial wellness?

Financial wellness is simply defined as your relationship with money. It also includes the plans you have in place to deal with variables that could impact your finances. Improving your financial wellness means improving your relationship with money. That said, here are some financial wellness examples.

Financial wellness examples

  1. Sticking with your budget
  2. Having a solid emergency fund in place
  3. Feeling emotionally balanced about money
  4. Having short-term, mid-term, and long-term financial goals in place

These are just some financial wellness examples. To gauge the current state of your finances, the National Financial Educators Council suggests asking yourself the following questions:

  • Are you financially prepared for emergencies?
  • Do you have active plans in place to reach your short-term and long-term financial goals?
  • Do you have a budget and do you stick to it?
  • What is your attitude toward money like?
  • Does thinking about money make you sick to your stomach or does it make you happy?

Keep in mind that these questions are not intended to make you feel bad. Instead, answering these questions can help you devise a starting point to improve your financial wellness.

Top 11 Financial wellness tips

So now that you have some financial wellness examples and know-how to gauge where you stand, it's time to dive into our financial wellness tips!

Remember that staying on top of your finances is an ongoing process, so it's okay if you aren't exactly where you want to be. The key is consistency.

That being said, here are a few tips for financial wellness:

1. Live on less to improve your financial wellness

Living on less is one of the best financial wellness tips you can do. This means focusing on getting your essentials in place, specifically your food, housing, core utilities, transportation, and any medicines. This also means cutting back on any non-essential spending until things get back to normal.

It's okay to downsize your housing, car, other things you own, your general spending, etc. Living below your means can help you save more money for more important things!

2. Make sure you have emergency savings before investing

One of the most important things you can have in place is an emergency fund. This money can help you weather difficult times. It can help put food on the table and pay for core bills until things get better.

Find that you need to save more money to ramp up your emergency savings? It's perfectly fine to save before you start investing. In seasons of uncertainty, the more savings you have, the better.

The last thing you want is to really need money but have all your cash tied up in an investment that you might have to sell at a loss. Once you have gotten your savings to a comfortable place, you can start investing.

3. Create multiple sources of income

What is one of the savviest financial wellness tips to start? Create multiple sources of income. Having more than one income source is essential to financial wellness. So don't rely on just one source of income. Find creative ways you can earn more money.

For instance, you might have some skills that you can monetize by freelancing or setting up a low-cost side hustle. It's all about challenging yourself to figure out ways to earn more.

4. Ask for help if you need to

It can be hard to ask for help even when you need to. However, it's sometimes necessary for your financial well-being. If you have to, let your lender and service providers know that you are facing financial difficulty.

It's okay to ask for help if you need it. Many lenders and service providers have programs in place for individuals facing difficulties. For example, rent assistance or mortgage forbearance programs.

However, it is extremely important that you understand all your options and the associated costs, i.e., interest, fees, penalties, etc. It's also important to understand what happens if you are unable to meet the terms of any agreements you have in place with your lenders or service providers.

5. Perform a financial health check

So how can you ensure that you are improving your financial wellness? Perform a regular financial health check! Do you know how you have a routine physical with your doctor to ensure you are healthy?

It's the same for your finances. You need to consistently check in to ensure you are on track with your goals, are sticking with your budget, and saving enough money.

6. Track your spending

Tracking your spending is one of the simplest yet effective tips for financial wellness. Something as simple as tracking your spending can have a powerful impact on your finances.

It can prevent you from busting your budget and see where you can cut back if needed. You can try keeping a spending journal or using an app such as Mint.

7. Use a budget that works for you

Not every budget works for everyone, which is why you need to find the right budgeting method that fits you best. There are so many methods to pick from!

For instance, the 80/20 budget is a percentage breakout method like the 50/30/20 budget but simpler to follow. You save 20% and use the remaining 80% for your wants and needs.

Or perhaps you would rather budget by your paycheck. This is where you budget every time you get paid, either weekly or bi-weekly. Whatever method you choose, make sure that it's easy for you to stick to!

8. Plan for retirement

The earlier you start saving for retirement, the better. A key part of financial wellness is setting yourself up for a financially successful future.

If your employer offers a 401k match, take advantage of it and max out your contributions if possible. Figure out how much you need to retire by using a retirement calculator so you can work towards your goal efficiently.

9. Become debt-free

Debt is a huge burden. Being debt-free can make your life much less stressful. You will also save tons of money in interest and have a tight reign on your finances. Just like picking out the right budget, you need to find the right debt reduction plan that is best for you.

For example, there is the debt snowball method where you pay the smallest balance first, then go to the one once that's paid off, and so on. Or you could get aggressive and use the avalanche method.

This method has you pay off the debt with the highest interest rate first. Figure out which one will be easiest for you so you can stay motivated to your goal of becoming debt-free!

10. Learn more about personal finance

You should never stop learning, especially when it comes to personal finance! These days it's easier than ever to learn everything you need to improve your finances.

You can find help with budgeting, investing, and everything in between! Check out bookspodcastsvideos, and online finance courses to help you get started.

11. Check to see if your employer offers financial wellness programs

Did you know that some employers offer financial wellness programs? These programs offer employees support with their personal finances.

For instance, help with budgeting, financial goal-setting, financial crisis management, and more. These financial wellness programs are a really beneficial resource to tap into if you have access to them.

Start these financial wellness tips today!

Start applying these tips for financial wellness so you can become financially healthy. You'll also be positively impacting your mental wellness as well.

Having control over your money can reduce stress, prepare you for unexpected expenses, and help you work towards building wealth. So get started improving your financial wellness today!

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