5 steps to financial wellness
Do your money habits and mindset need a makeover? Follow these 5 tips to help boost your financial wellness.
Financial wellness is so much more than lighting a scented candle and trying to manifest money into your life. Money is often cited as one of life’s big stressors – 1 in 3 adults had been anxious about money during the previous month, according to a recent study by the Mental Health Foundation. And 1 in 10 said they felt hopeless because of financial concerns.
Just as we use exercise, diet or meditation to boost our physical and emotional wellness, there are practical steps we can take to reduce the negative impact money has on our lives. So here are 5 steps to boost your financial wellness.
1. Swap the millionaire complex for better money habits
We’ve all been there, thinking to ourselves, “If only I had a million pounds, I wouldn’t have any worries in the world.” But how you manage a small amount of money often indicates how you’d manage a large amount. If you immediately splurge every time you get a bit of extra cash, what’s to say you won’t do the same thing with £1m (just with Ferraris and jet skis instead of pumpkin-spiced lattes)?
Regularly checking your bank account and credit card statements is a good place to start. Build a realistic budget you can stick to and save a consistent amount (even if it’s just £5 a month!) for a whole year. If you need help getting started, try a free budgeting app like Plum or Emma that uses Open Banking to automate your savings. Financial wellness is less about how much money you have and more about how you use what you do have.
2. Focus on one thing at a time
I’ve learnt the hard way that it’s far better to focus on one goal and achieve it than go for gold and not really hit any of your money goals.
A good place to start is to prioritise paying off high-interest debt, then consider building an emergency fund in a savings account and work up from there. One hack to get some savings growing in the background is to take advantage of a bank switching offer (like Nationwide’s new £200 switch bonus, for example), then stick the bonus in a high-interest saving account. This new Nationwide switch deal gives you access to its Regular Saver account at 8% AER. There are plenty of other good savings rates around at the moment, too.
Life is busy and messy, so be kind to yourself and give yourself the space to focus on one thing at a time.
3. Revamp your money mindset
If you’re constantly telling yourself you’re bad with money, and you’ll never earn more than you earn now, you could be holding yourself back from seeking help or applying for that new job.
Write down a few of your negative beliefs around money, and think about where they came from and whether they serve you anymore. And if you feel any negative self-talk creeping in, swap it out for a positive or neutral affirmation. “I am bad with money” becomes “I am learning to be better with money”.
4. Don’t fall off the bandwagon!
Get rid of the bandwagon entirely! When it comes to your money, if you have a bit of a blow-out or have to fork out for something expected, don’t freak out! Instead, review your statements, adjust your budget and keep on rolling. Why delay getting stuck into those good money habits you’ve started building?
5. Start thinking about future you
Financial wellness is as much about your mindset as it is about the practicalities of managing your money.
Some key places to start include building an emergency fund and consistently paying into a pension pot. Even if you can only save a small amount, having something to fall back on is better than nothing. High-interest savings accounts are a great way to get a little boost on your savings every month or year. And if you have spare cash, you could also invest it.
Just bear in mind that investing does come with the risk that you could lose part or all of your investment. Investing is typically considered a better long-term strategy, so make sure you can afford to potentially invest that money over several years.
About the author
Louise Bastock is an editor at Finder, specialising in a broad range of personal finance topics, from financial wellness to first-time buyers. As video manager, she’s also responsible for presenting and producing the UK’s video content across multiple channels, including YouTube, TikTok and Instagram.
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