Financial Well-being and Your Emotions, What You Need To Know

          As a financial therapist, I want to educate my clients on what financial wellbeing is, and what may be blocking them from reaching their financial goals. Financial planners and other industry experts have plenty to say about the topic, but I’m going to share from my perspective. In this post, I will explain more about how emotions, thoughts, and past experiences create our money relationships and impact our financial wellbeing.

How do we define financial wellbeing?

          What is the definition of financial well-being? The Consumer Financial Protection Bureau defines it as:    

          Financial well-being describes a condition wherein a person can fully meet current and ongoing financial obligations, can feel secure in their financial future and is able to make choices that allow them to enjoy life.

          That seems pretty clear and attainable, right? If you have a well-paying job, your financial well-being is a given. Actually, no. Having money is not the entire answer. Those with fewer means can also achieve financial well-being. The fact is there are several elements that contribute to a person’s financial wellbeing, including a person’s level of income, education, goals, aspirations, and reasonable expectations. This means everyone can find their own financial well-being regardless of the money they earn.

What is your relationship to money? 

         Whether you are aware or not, you have a relationship with your money. You have both conscious and unconscious thoughts about money. For example, you are conscious of how your income is received and how you spend your money, say to pay bills or buy food. Unconsciously you have emotions around your money. It could be frustration or resentment that stems from a time when money was lacking or withheld from you, and that may cause you to presently struggle with money. It could be you desire a level of affluence you were accustomed to that you do not have currently. Whatever your personal feelings are, to find the financial well-being you long for, you have to explore and address these unhealthy or unnerving feelings you have toward money in order to move forward toward fulfilling financial well-being.

How do thoughts, feelings, and emotions impact financial wellbeing?

          Another aspect of establishing financial well-being is integrating your thoughts and feelings about money and your financial behaviors in a way that aligns with your goals. For example, if your goal is to save money for a house, actually setting money aside into a savings account would be an aligned behavior. However, that impulse buy that gives you a knot in your stomach, maybe an action not in alignment with your goal. Understanding our thoughts and feelings about money can help us interact with our money in a way that serves our goals rather than sabotages them. We have all made decisions that are aligned with our goals and others that haven’t. Think about each type of scenario and how it made you feel at the time. When you are clear on your feelings about finances and have your goals in mind, you are likely to stay more aligned in your actions and decisions all of which lead to better financial wellbeing.

How do you balance being Practical and enjoying life?

         When it comes to financial wellbeing it is important to balance the practical and the emotional side of finances. Examples of the practical side include making sure your bills are paid, that you are preparing for retirement and that you can live comfortably when you get there. Emotionally it is also important to make sure that you stay connected with your life now. Make sure to do things you enjoy, spend time with loved ones, and not keep those things just for “someday.” Your future financial aspirations are equally as important as your current financial picture when it comes to your financial wellbeing, so be sure to allow room to explore both.

What should you do now?

        When your goal is healthy financial wellbeing and living the life of your dreams, you cannot leave out how you relate to your money and why you have the beliefs you do. This may be something you explore on your own, or through financial therapy. Either way, understanding and addressing those feelings is key. Key to helping you enjoy the now and prepare for the future in an intentional way, allowing you to experience the joy and peace that comes with financial wellbeing no matter what part of the journey you’re on.

Would you like more 1 on 1 support? Then perhaps Therapy Informed Financial Planning is for the two of you. I invite you to schedule your free 30-minute discovery call today.

Wishing You Healthy Love and Money,

Ed Coambs

MBA, MA, MS, CFP®, CFT-I™, LMFT

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