Individual Americans spend hundreds of dollars a year and at least as many hours on keeping themselves physically fit. However, too many people neglect their financial health. Just like physical health, being financially fit is crucial to your wellbeing, your future and your quality of life.
Here’s why being financially fit is so important and how you can overcome common barriers to achieving financial wellness.
Financial wellness: a ripple effect
Being financially fit is about more than just having enough money in your account to cover your expenses and put away something for tomorrow. Managing money responsibly will affect many aspects of your life:
- Marriage. Money brings resentment and arguments into a marriage. According to a recent study by AARP, financial problems are the second leading cause for divorce in the country.
- Mental health. Money stress can severely affect your mental health, causing depression, restlessness, anxiety and more.
- Physical health. Stressing over finances can also directly impact your physical health. It can lead to symptoms like headaches, fatigue, upset stomach, insomnia, and an increased risk of heart disease and stroke.
- Work life. Being bogged down by money worries can make it difficult to focus at work – bringing down productivity levels and hampering career growth. In addition, prospective employers tend to review the financial wellness of new hires as part of their background checks. High rates of debt and a poor credit score can cost an employee a new job.
- Parenting. Managing money irresponsibly can mean not having sufficient funds to pay for a child’s education, private lessons, medical needs and more.
What are the leading causes of money stress?
According to a survey by Credit Wise®, 73% of Americans rank money issues as the number one stressor in their lives. Here are the top causes for financial stress:
- High-interest debt
- Insufficient savings
- Medical bills
- Living paycheck to paycheck
- Lack of retirement planning
Stressing over money is never fun. Stressing over money, when any of the above applies to you, takes on its own form of angst by adding a level of long-term anxiety. It takes time, sometimes years, to undo the damage of any of these stressors – but it can be done!
Barriers to financial wellness and how to overcome them
We’re convinced: being financially fit is super-important. But what happens now? Many people may understand that financial fitness is crucial to their wellbeing. Unfortunately, there are several barriers that make it difficult to follow through on their convictions.
First, many lack the basic financial knowledge necessary to responsibly manage their money. Second, many people mistakenly believe that budgeting, saving and being more mindful of how they manage their money are too time-consuming and tedious. Finally, some people may have fallen so deeply into debt, they’ve begun believing they will never be capable of ever pulling themselves out.
Here are some simple steps you can take today to help you achieve and maintain financial wellness:
- Get educated. There is no shortage of financial literacy available to the interested consumer. Learn from financial literacy blogs, personal finance books, podcasts, online classes and so much more. When you learn how money works, including long-term investments and high-interest credit card debt, you can make better choices.
- Have the money talk with your partner. It's important to be on the same financial page as your partner. This is true whether you've been sharing expenses for half a year or you've been married more than a decade. Talk openly and honestly, being careful not to be judgmental in any way, and discuss your individual and shared long-term and short-term money goals. Then come up with a plan for how you intend to reach them together.
- Pay all bills on time. If you can’t take aggressive steps toward paying down debt just yet, be sure to make the minimum payment on each credit card bill each month.
- Create a budget. Giving every dollar a destination makes it easier to spend mindfully and cut down on extraneous expenses.
- Start saving. There’s no such thing as a sum of money that’s too small to put into savings. Every dollar counts, and once you get the ball rolling, you’ll be motivated to pack on the savings until they really grow.
The steps outlined above are a great place to start. Also consider speaking with an expert who can guide you through the steps to reach your short-term and long-term goals. As a member of McCoy, you have access to financial counseling resources through GreenPath – so take your first step toward financial wellness today.