Financial Wellness and Your Relationship with Money

Every person has a different perspective about financial wellness when asked to evaluate their financial health or well-being. Financial wellness is personal and therefore unique for every individual. From a consumer standpoint, financial wellness is a state of having financial security and having the ability and capacity to achieve and sustain financial confidence. From a financial advisor standpoint, it is a mindset formed from the way a person evaluates their financial situation, how they feel about it, and how it affects their stress levels and overall mental and physical health. Most people in low income brackets struggle to stay on track with their finances, and therefore it is not surprising for them to turn up having low financial well-being. What is hard to believe is when those in high income brackets are the ones to tell of having low financial well-being despite meeting their financial commitments. How come client A making $50,000 a year income has a $6,000 RRSP savings while client B making $100,000 a year has none? How could some people still struggle to get out of the debt cycle despite having some financial literacy? Household income and financial literacy do play an important role in a person’s financial well- being. However, it is our attitudes and financial behaviours that have a stronger impact on our financial well being.

Financial advisors share different approaches in educating people how to achieve and maintain a healthy financial life. At Financial Wellness Bureau, we believe that our financial well-being reflects our relationship with money. People with strong financial health have good relationship with money, while those with poor financial health have poor relationship money. We believe that in order to improve our financial situation and manage our finances effectively, we need to assess and fix our relationship with money first. Once we have a clear understanding of our personal relationship with money, it will be easier for us to apply any acquired financial knowledge in creating and implementing a solid financial game plan that will help us improve our relationship with money and financial well being.

Assess your relationship with money.

First things first, let it be clear to everyone that we do not equate people with money when we talk about relationship with money. Just focus on the idea of having a relationship. Our relationship with money is shaped by our learned principles and past experiences with it. What is your experience about money? Was money scarce or abundant when you were young? Were you raised to believe that money cannot buy happiness and money is the root of all evil? What do you think of money? How often do you think about it? Do you like talking about it? How do you take care of your money? How do you feel about loosing or spending? Do you prefer to save it or grow it? From your answers, figure out how your past experiences shape your personal beliefs about money and how these beliefs influence your actions and behaviour with money. Do you have more positive thoughts or negative thoughts about money? What is your relationship with money? Is it good or bad?

How Can You Fix It?

Money is different for all of us and so does our relationship with it. Imagine yourself being in a relationship and you want to make it work and live happily ever after. How can you attract it to your life? How can you keep it when you have it? What are you willing to give and receive in this relationship? What are your boundaries?

Communicate your thoughts and feelings. Relationship experts will definitely say that “communication is the key!” Do not avoid talking about your challenges around money, your spending habits, your assets and liabilities. Talk about it with yourself, with your partner or with your financial advisor. Review your current financial situation. Acknowledge your financial mistakes and apologize for your shortcomings.

Identify and eliminate your limiting beliefs about money. For example, people who think money is scarce tend to be less enthusiastic about making more money. This limiting belief limits their opportunity to make more money. If your limiting beliefs are causing you financial stress and burden, you must start with changing your thinking process. Start thinking money is everywhere instead. Transforming your negative thoughts into positive thoughts will improve your attitude towards money. When you start to change your thinking process, your actions will start to align with it.

Make time and effort to attract money into your life by engaging in income producing activities. Income is one of the four pillars of personal finance and the most fundamental. Without an income stream, there is nothing to protect, and there is nothing to spend, save and invest. Whether you choose to work for money by getting a job or choose to make money work for you by investing or running your own business, either way you will attract money.

Set Your Goals and Work it. Have a clear vision for your life and always be clear on your intentions or goals. Create a financial game plan that lines up with what matters most to you. What type of assets do you want to own? What kind of lifestyle you want to achieve and maintain? How will you protect your money? How will you manage it? How will you spend it? Your actions determine your outcome so take 100% responsibility for you own life.

Be Willing to Give and Receive Money. Balance giving and receiving money. In any relationship, your cannot expect to always be at the receiving end without having to give as well. Likewise you cannot always do all the giving and forgo the gift of receiving. It is probably easy to decide to receive money because it is human nature to seek love, appreciation, compensation and acknowledgement. However people who associate receiving money with weakness and shame are not likely comfortable receiving it. They are more likely to prefer to be the giver with this matter of thinking. Giving away money is actually more satisfying and is just as important as receiving it. It gives you an opportunity to express feelings of abundance. Money is energy that passes from hand to hand. It is through the act of giving that you can allow money to circulate and NOT block its flow with your hands. Are you better at receiving or giving money? You need to have a balance of both, for money to continue to flow and improve your relationship with it.

Pearl Briones-Doonan