What is Financial Wellbeing?

We are told ‘plan our finances for the future’, but for what purpose?

Retirement – what is that?

The future – what does that look like?

But surely in order to plan in a way that is right for you, it is first necessary to decide what it is that you want to do and when.

This may sound simple, but in reality, it’s a lot harder to do. We’re held back by limiting factors and barriers that exist around us, for example not giving oneself permission to dream, being over committed to others or facing financial limitations.

What does Financial Wellbeing really mean?

Chris Budd, in his book “The Financial Wellbeing Handbook” sums it up nicely:

“The key to financial wellbeing is not having the life others think that you should have, but the life you want”.

We are told continuously that we must put money into a pension, because “it’s the right thing to do!” But why? For what purpose? When?

Wellbeing is promoted as the key to future happiness, but it generally focuses on physical and mental wellbeing as the key parts to get right.

How many times are you told that you must exercise, that you must eat the right foods and drink less alcohol. We are bombarded with these messages on television, social media and newspapers. But, is this really the holy grail to a long and happy life?

In my view there are several types of wellbeing:

  • Physical wellbeing
  • Mental wellbeing
  • Career wellbeing
  • Social wellbeing
  • Community wellbeing
  • Financial wellbeing

Of these I feel very strongly that the key to them all is Financial Wellbeing, but caveat this by saying that it should not be at the expense of the others.

The Consumer Financial Protection Bureau in their 2015 report on Financial Well-Being, put forward four main areas that constituted Financial Wellbeing:

  1. Control over your day to day finances
  2. Financial freedom to make choices to enjoy life
  3. Ability to be able to absorb financial shock
  4. On track to meet your future goals

I’d like to add a 5th point and that is to have…

  1. A clear path to achieve identifiable objectives

Business Plan for Life

What does a clear path to achieve identifiable objectives mean?

I’d like to introduce the concept of having a Business Plan for Life. “Isn’t that just for businesses?”, I can almost hear you saying.

It is true that all good and successful businesses have a clear business plan written down, but why is it not done for personal life as well?

Dare to dream

Do you have a dream, something that you really want to do in your life? Maybe you’ve then thought that it was too far out of reach and that it should always remain a dream. It is nice to dream, and I think that using the mind in that way is very important.

What if we could turn that dream into reality in financial terms?

You can!  Creating your Business Plan for Life is the next step to realising your dreams.

How to create a Business Plan for Life

Where do you start?

The next time your mind starts to wander, sit down with a blank sheet of paper and your favourite tipple – a cup of tea or coffee, glass of water or, more preferable, a glass of a decent Malbec – and allow your mind to explore your dream.

As the ideas start to flow write them down, no matter how extreme they may seem. This exercise can be done alone, with a partner or trusted friend. If with a partner, it’s okay to have different dreams, but also look out for shared ideas as these will inspire you as well.

This is the first step to creating a Business Plan for Life. Next, enlist the help of an Independent Financial Planner, such as me, to turn your ideas into a financial plan, which will provide you with the Financial Wellbeing to support a happy and fulfilled life.

Next steps…

If you’re not already a dreamer, we hope this article has helped you to think about dreaming. We also hope that we’ve shown you the way to developing those dreams and find a way to make them a reality. If we can help you along this journey, please get in touch on 01372 275 098 or email us.