It’s no secret that Australians enjoy comparatively high wealth, according to a global standard. However, the average level of financial wellbeing is low. 

That’s why it’s important to discuss financial well-being – with a view to gaining financial security, freedom and confidence to deal with whatever direction life may take.

The difference between wealth and financial well being;

Firstly, it’s important to note that financial well-being isn’t the same as being wealthy. Wealth is typically measured by how much money someone has and the assets they own, such as shares or investment properties. But the reality is, you can have these things and still lack financial wellbeing, depending on how you manage your money.

Rather than just a tally of wealth, financial well-being should be viewed as:

  • keeping up with debt repayments, living costs and other financial obligations
  • having savings and being able to handle unexpected expenses
  • being free from financial stress
  • having the financial freedom to live an enjoyable lifestyle
  • feeling secure and in control of finances – now, in the future, and if life takes an unexpected turn.

The barriers to financial well-being

When it comes to creating financial well-being, there are a number of factors holding Australians back. For one thing, living costs and property prices are surging. As a result, we now have the fourth-highest debt levels in the world. While most of this can be attributed to growing mortgages, Australians also have an average credit card balance of $3,260.

It’s no surprise then that we’re saving less than ever before. In fact, as a percentage of household income, average savings are projected to fall to 2.1% by 2020, down from 7.5% five years ago.  Even more concerning is the fact that one in four Aussie households are living from one pay to the next, without even $1,000 in their bank in case of an emergency.

This lack of financial well-being is a major contributor to stress among Australians, with impacts on physical, mental and emotional health.

Ways to initiate financial well-being considerations

  1. Look through various scenarios of how your financial situation may change in different situations – for example, if you need to take time off work to care for children or elderly parents, or separation resulting in a change to receiving a single income.
  2. Look at spending and saving patterns. This can be a great opportunity to look whether a significant portion of their spending is going towards repaying debt, and how much you’re putting aside from each paycheque to cater for unexpected expenses. It can also be a helpful way to highlight areas where expenses may be higher than they need to be.
  3. Speak to a Financial Planner

For more information and to book in an obligation free consultation please contact MASU on or +612 8297 6666