Assessing Your Financial Wellness
How do you define financial wellness in your life?
Earlier this week, a young woman asked me the question: how do you define financial wellness? In turn, I responded by asking her how she might define it for herself.
Her definition was that if she lost her job tomorrow, she would feel okay. I think that's a great definition–removing any stress that you have financially and no longer relying on your job for money.
I also recommended one of my favorite books to her, Your Money or Your Life by Vicki Robin. In this book, Vicki really challenges us to ask ourselves what is enough when it comes to money. So often we get used to needing more and more money, and as we get more money and buy more stuff we think the next step is to need even more.
This puts us on a dangerous cycle, always needing more and never having enough. The trouble with this is that we make things all about the money–more, more, more and not about what the money allows us to do in our lives.
If you were to ask me, I would suggest financial wellness isn't about the money at all. It's about with the money allows you to do and how you feel about your life as a result.
In my Queen Money Moves™ coaching program, I teach women my ACE Method of Money Management. The “A” stand for “assess,” the “C” stands for “choose,” and the “E” stands for “execute.”
Today I want to invite you to do a financial wellness assessment of your own life. To do this assessment, we are going to turn to Your Money or Your Life by Vicki Robin. In her book, she lists 10 financial indicators that I think will work really well for our assessment today.
Wherever you are, I want you to pause and answer these questions for yourself (from pg. ix in Your Money or Your Life):
Do you have enough money?
Are you spending enough time with family and friends?
Do you come home from your job full of life?
Do you have time to participate in things you believe are worthwhile?
If you were laid off from your job, would you see it as an opportunity?
Are you satisfied with the contribution you have made to the world?
Are you at peace with your money?
Does your job reflect your values?
Do you have enough savings to see you through six months of normal living expenses?
Is your life whole? Do all the pieces–your job, your expenditures, your relationships, your values–fit together?
How did you do on this assessment? Wave you been using your money to create more freedom and satisfaction in your life?
If not, I would encourage you to think about what steps you can take today to turn things around and use your money to create more freedom and satisfaction. That is the path to financial wellness.
If you’d like a suggestion on one thing you can do today, I would recommend taking a look at how you're currently spending the money that you have. Think about your values and the vision that you have for your life. Then look at that budget and ask yourself how well your current spending decisions align with your values and your vision.
Are there things that need to be cut from your current budget? Are the things you need to add?
There is no set ideal budget. Your money is a tool for you to achieve the things you want in your life, so start with your budget and start making some different choices today.
And if you get a chance, definitely pick up Vicki Robin’s book, Your Money or Your Life. It's one of my favorites and one that should definitely be on your shelf right next to my book, The Black Girl’s Guide to Financial Freedom.