Taking Financial Ownership

Lisa Asks You: What’s your level of financial wellbeing? (Quiz!)

As we kickstart 2019 with this January edition of Ask Lisa, we’ve decided to change things up a bit. This month it’s my turn to ask some questions and your turn to answer! No need to panic, this isn’t a quiz that you can fail. Rather, I want to help you get to know your (financial) self a little better. We’re focusing on financial wellness… or as I like to call it, “wellth”.

Wellness is quite a buzz word these days, but how does it relate to personal finances? To understand that, let’s take a look at the definition of wellness:

“…a state of complete physical, mental, and social well-being, and not merely the absence of disease or infirmity.” – The World Health Organization

It’s clear that wellness is about more than our physical health, it’s about the quality of our daily life. What I especially like about this definition is the understanding that it’s not just about absence of the negative, but a cultivation of positive habits and experiences.

Relating this to finances, money is the number one source of stress for 42% of Canadians, and stress about finances absolutely affects our physical, mental and social well-being. Specifically, it can cause us to lose sleep, experience anxiety, argue with partners and lie to our family and friends. Eliminating our money stress, and the unhealthy behaviours that go along with it, is the first step towards a “wellthier” future.

However, financial wellness isn’t just about being free from money stress, or free from debt. Just like you can be free of disease but not healthy, it’s possible that you could be stress and debt free, but not “wellthy”. This is because financial wellness requires a cultivation of positive habits that help you maintain and improve your wellbeing over time. Think of it like the financial equivalent of exercising and eating nourishing foods on a daily basis.

If you’re wondering where you fall on the financial wellness scale, take this quiz to help you assess your “wellth” and identify the steps you can take in 2019 to improve your financial well-being.

For each question, select the answer that best reflects your current reality.

1. I can tell by my credit card and bank balance that I:

a) Spend more than I earn because I’m accumulating debt
b)Spend everything I earn, because I’m always breaking even
c) Spend less than I earn, because I’m building up savings

2. The first thing that I spend money on after receiving my paycheque is:

a)Treating myself to something I’ve been wanting
b)Paying an overdue balance or bill
c)Saving for a long term goal

3. My savings plan is:

a)Non-existent, I’m not earning enough to be able to save
b) Inconsistent and depends on how much is left over at the end of the month
c) Automated and happens without me needing to do anything

4. When I think about my finances I feel:

a) Fear, guilt, shame or overwhelm
b) Curious, cautiously optimistic
c) Confident and secure

5. I would describe my current “relationship status” with money as:

a) Strangers, I’m not comfortable around my money
b) New friends, I’m excited to learn more about it
c) Committed, I have long term goals and a plan to get there

6. If I suddenly lost my job I would:

a) Panic because I have no savings or backup plan
b) Worry about how long I can make my savings last
c) Seize the opportunity to re-evaluate my career satisfaction because I have an emergency fund that will last at least six months

7. My monthly income is:

a) Not enough to cover my basic needs
b) Should be enough but I often feel like I could use more
c) More than enough to cover my needs and wants

If you answered mostly A’s….

 Financial Wellbeing At Risk

You might feel like you are living in financial chaos, or avoiding the reality of your financial situation. While these are common symptoms of low financial wellbeing, it doesn’t have to stay this way! The first steps to improving your “wellth” are getting organized and becoming aware of your financial situation. Start with a small, fun project, like cleaning out your wallet or purse. Next, log in to your online banking and take a look at the balance in each of your accounts so that you know where you stand. Then, up the ante and go through your outstanding bills and debts, making a list of everything that needs to be paid off. Be gentle with yourself while you work through this stage and celebrate the little wins.  Your goal is to ease the fear and get yourself to a place where you’re ready to make proactive changes.

 If you answered mostly B’s…

 Moderate Financial Wellbeing

In this stage of financial wellbeing you might feel like you are stuck in a financial rut, not racking up debt but also not racking up savings. You’re more or less in control of your financial life, knowing how much you own and how much you owe, and while progress is slow you are feeling cautiously optimistic about your ability to reach your financial goals … one day. If this is you, your next step to improve your wellbeing is to create a long term financial plan that will map out how you will get from your current financial position to your ultimate financial goal. What exactly are your financial goals? How much do you need to save each month to reach them? What accounts can you be using (for example, TFSA, RRSP, RESP)? The process of writing down your plan will help you turn a fuzzy vision for the future into realistic, actionable steps. There are loads of online resources that can help you with this, or you can seek out a fee-only financial planner for personalized advice.

If you answered mostly C’s…

 Living the Wellthy Life

Congratulations! You’ve achieved an optimal level of financial wellbeing. You’ve mastered your cash flow, have implemented a savings plan and are confident that you have enough money to reach your financial goals – and then some. Since money truly isn’t a source of stress for you, your next step is to cultivate feelings of personal freedom and purpose. This stage is all about using your money – and time – to enjoy your life and leave a legacy. Perhaps it’s time to take that epic trip you’ve been saving up for. Consider taking on a volunteer position to give back to your community, or making donations to a cause that matters to you. And of course, make sure to commit to regular check-ins with your financial plan so that you ensure you stay on track no matter what curveballs life throws at you.

Are you ready for more?

Want to take your financial wellbeing to the next level? In celebration of stnce’s one-year anniversary we’re giving away some prizes to help you live your best financial life, including three one-on-one personal financial planning sessions with Lisa! Click here for more information on how to enter.

Note: This quiz was created based on the 7 Stages of Financial Wellbeing developed by Money Coaches Canada.

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