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What Exactly Is Financial Wellness?

What Exactly Is Financial Wellness?

In recent times, ‘Financial Wellness’ is a term that you must have heard frequently. With the coronavirus epidemic kicking in, everyone has become increasingly interested in achieving the state of financial wellness. Yes, you read it correctly; ‘Financial Wellness’ is a state and not something that you can learn by cramming up books and terminologies.

Coming to the next question, is financial wellness different from financial literacy?

The answer is yes. ‘Financial literacy’ is the art of attaining knowledge about financial concepts and skills that will lead to the path of financial wellness; whereas ‘Financial Wellness’ means attaining a state where you are comfortable with your finances; which eventually helps to achieve physical, mental and social wellbeing.

Financial wellbeing is a broader term and does not end with just getting to know a few financial terminologies and concepts. It is about paying attention to your financial needs and creating enough buffers; to safeguard you in times of financial crises. If an individual undermines the importance of financial wellness, all other aspects of his/ her life may suffer drastically.

It is very easy to obtain an understanding of financial terminologies, but its application in real life is altogether a different ball game. Based on individual fact patters, financial wellness calls for making financial decisions through a well-thought and robust decision-making process.

Like every human being is different, no single financial plan can work well for every individual. Therefore, you need to work very diligently with your advisors to create a custom-made plan that ensures your financial wellness.

From the time we are born, and till the time we approach our deathbed, most of us strive to evolve. It leads us to think about all the choices that we make during our lifetime. Among the various other choices we make in life, we involve ourselves in making a lot of financial choices. Which is the core of our survival? Therefore, to ignore or not care for something, this important can badly affect your career, retirement, relationship, health, etc.

Managing finance is not just understanding numbers but making strategic decisions with numbers. It is about training your distracted mind to focus and be rational. It may seem normal; but you would agree that in reality, biasness and sudden urges tend to clutter your mind more than you think.