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Financial wellness: What it is and how to get it

December 29, 2021 - 18 min read


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What's financial wellness?

Why is financial wellness important?

The benefits of financial wellness

7 steps to attain financial wellness

Why should companies care about financial wellness?

6 financial wellness programs for employers

Attaining a life well-lived can be harder than it seems.

When we think about health and well-being, it’s natural to consider the physical, mental, and emotional aspects.

We know that food, shelter, and safety meet our basic fundamental human needs. We know that humans crave connections, social activities, and relationships. We know that mental fitness and mental health are crucial to achieving a sense of wellness

But there’s one aspect of well-being that wasn’t necessarily associated with the topic a decade ago: financial wellness. According to PwC’s 2021 Financial Wellness Survey, stress is on the rise. In fact, 63% of employees say their financial stress has increased since the start of the pandemic. 

It also cites 42% of full-time employees find it difficult to make ends meet. People are struggling to meet household expenses on time each month. And with rising student loan debt, housing and food costs, and financial insecurity, financial wellness is crucial.

What's financial wellness? 

Let’s talk more about the details of the meaning of financial wellness.

There are a lot of variables that go into what makes up financial wellness. Dependent on your stage of life, you’re probably thinking about money differently.

For example, many baby boomers are on the cusp of retirement while millennials are still in the thick of their careers. And Gen X and Gen Z-ers are likely just starting their journey to attain financial wellness. But each generation has a unique attitude towards money — and what it means to attain financial wellness.

To examine your financial wellness, start with these considerations: 

  • Are you prepared for an emergency? 
  • What’s your attitude towards money? How does talking or thinking about money make you feel? 
  • Do you have short-term and long-term financial goals? 
  • Do you have a budget? Do you stick to it? 
  • What’s your retirement plan? 

Just like every other aspect of life, everyone’s financial journey is different. But one thing is undeniable: everyone deserves to feel financially secure.

At the end of the day, financial wellness is essential to holistically improve your mental fitness. Let’s dig into how to attain financial wellness. But first, let’s talk about why it’s important. 


Why is financial wellness important?

When it comes to money, every penny matters. Attaining financial wellness gives a sense of financial security and freedom.

It means you might not have to worry about a sudden emergency, job loss, or career change that might impact your finances in the short term. It might mean less stress, more time with family and loved ones, and more meaning and purpose in your career.

But it’s important to recognize that not everyone is starting at the same “starting line” in this marathon to find financial wellness. The gender pay gap is still very prevalent: women earn less than men. It’s estimated it would take an extra 42 days of work for women to earn what men did in 2020. 

But there’s also a financial literacy gender gap. Data shows men understand money better than women. This gap in financial literacy can be attributed to inequity in how we teach and empower women’s success in today’s world. Getting financial education is imperative to understand what it means to be financially well.

The persistent racial wealth gap continues to make little to no progress. Research shows that closing the racial wealth gap is key to addressing inequality at scale.

Attaining financial wellness doesn’t just mean you can feel a sense of financial freedom and security. Financial wellness is the key to solving large-scale, complex inequities embedded in our society. We also know there's a cyclical relationship between mental health and money

Why should we care about equity and financial wellness? In short, financial wellness for all can help empower human transformation at scale. And when we unlock opportunities for everyone to attain financial wellness, the benefits speak for themselves.

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The benefits of financial wellness 

While the phrase “money can’t buy you happiness” does hold some truth, it’s also true that achieving financial wellness does have its benefits. And research shows the importance of financial wellness.

Less stress

We know that money is stressful. Financial stress has only increased since the onset of the pandemic. With financial health and wellness, you can reduce your overall stress levels. Money stress can bleed into other areas of your life, like family, relationships, and career planning. Investing in your financial wellness can help you reduce your stress. 


Increased innovation and creativity

If you’re constantly worried about money, you’re less likely to take risks. Risk-taking is so important to innovation and creativity. If you’re not in a place of financial security to be able to take a risk, you could be missing out on huge amounts of innovation and creativity. 

Harmony between work and life 

If you’re struggling to make ends meet at the end of every month, chances are you’re sacrificing areas of your personal life to make money. With increased financial wellness, it can also mean more freedom to find your passion. You can find a harmony between work and life that'll allow you to focus on what matters to you. 

7 steps to attain financial wellness 

Financial wellness looks different for everyone. If you’re looking to invest in your financial health and well-being, it’s important to consider all aspects of your economic life.

1. Establish your starting point 

It’s hard to know where you’re going without knowing where you’re starting from. Give yourself a financial audit to get a sense of your spending habits.

This includes things like credit card and student loan debt, monthly living expenses, savings accounts, and more. Understanding your financial habits is key. You might learn a little more about yourself in this process.

Try asking yourself these questions:

  • What’s important to you?
  • What’s not important?
  • Where have you been investing your money?
  • What does that tell you about your financial priorities?
  • Where do you see areas of opportunity?

2. Create a spending plan 

A budget goes a long way in the journey to attain financial wellness. By creating a spending plan, you’re helping yourself make good choices on where your money goes.

3. Manage your debt 

We’re living in a time where consumer debt has hit record highs. Between student loan debt and housing alone, it can feel unmanageable. Reducing and/or eliminating debt (such as from credit cards)as soon as possible is key to financial stability.

4. Design an emergency plan 

Life is unexpected. COVID-19 taught us that life can change in an instant. It’s important to have a nest egg of emergency funds to tap into for those unforeseen circumstances.

Financial experts recommend individuals have three months' worth of living expenses saved. For families, they recommend six months of living expenses saved as part of an emergency fund.

5. Save for the future 

As a general rule of thumb, it’s recommended to dedicate 10-15% of your gross income to retirement funds. The exact amount depends on the person, but the sooner you can start saving, the better. It's important to factor in your long-term goals even if they feel too far in the future to think about.

6. Tap into available resources and tools

If your employer offers financial wellness programs, take advantage of them. Ask your HR team if there are financial wellness programs you can learn about. You might consider working with a financial advisor to ensure you're maximizing your investments. 

7. Give back

This might seem like a counterintuitive piece of financial wellness. Research shows that giving back does have its own set of mental health benefits. If you can, give to causes you care about. 

With the right tools and resources, you can make smart financial decisions for your financial well-being.


Why should companies care about financial wellness? 

Financial wellness is important for business, too. The business benefits of offering opportunities to attain financial wellness speak for themselves.

  • Less stress: One study found that financial wellness is the number one benefit program employers are looking to add in the next one to two years. And 88% of employers who do offer financial wellness programs say their employees are less stressed
  • Better performance: Employees who are less stressed perform better in their roles. When employees are stressed, employers see a high error rate and poor quality of work. They also see health problems (like anxiety, depression, and other mental health issues) emerge. By empowering financial wellness for your employees, employers are empowering better business performance. 
  • Employee retention: Companies that offer financial wellness programs are more likely to retain their employees. There’s a clear correlation between employee engagement and retention. 

6 financial wellness programs for employers

Like any other aspect of well-being, financial wellness needs to be examined holistically. Because there’s no one-size-fits-all program that solves for financial wellness, it’s important to offer options.

There’s a suite of financial wellness benefit programs that businesses can offer to their employers. 

  • Retirement savings plans: This should be a no-brainer. Empowering your employees to be able to save for retirement is crucial. Beyond just offering retirement options, think about how your organization can maximize impact. This could mean implementing a company match for a 401(k).  
  • Life and disability insurance: These are safety net programs. While we hope these programs are rarely used, life and disability insurance are incredibly beneficial in certain circumstances. 
  • Financial planning programs: Companies offer programs to connect employees with financial advisors. Financial planning programs cover topics like wealth management, investments, and estate planning. 
  • Financial coaching programs: Working with a coach on a one-on-one basis is so beneficial for employees. Consider implementing a coaching program for personal finance, budgets, savings, debt, and more. 
  • Emergency savings funds: Some companies offer emergency savings funds to help in cases of emergency. If a natural disaster displaces employees from their homes, an emergency fund can help relieve that financial worry. 
  • Family planning and fertility programs: Family planning and fertility programs come at a premium cost. Building a family is a stressful and expensive journey. By offering a fertility and family planning program, companies reduce some associated stress

As the workforce has evolved to become the most multi-generational in our history, employees are looking for a wider range of options. It’s important to think about financial wellness as holistically as you would with physical or mental health needs. The programs companies offer should reflect the diverse needs of the employees and their families. 

When employees are not financially well, businesses suffer. Implementing financial wellness programs is a good start. But companies need to educate their employees on how to use them.

It’s important that employees have access to financial wellness programs. But it’s more important that they understand how to leverage the programs on their own financial wellness journey.

Invest in your financial wellness

Why wouldn’t you invest in your financial health? Like any other aspect of well-being, financial wellness is holistic and unique. Financial wellness will look different for everyone. 

Regardless of where you are on the journey, start by setting small goals. Over time, those goals will snowball into milestones. With the right tools, resources, access, and programs, you can attain financial wellness.

After all, your financial future is in your hands. 

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Published December 29, 2021

Madeline Miles

Madeline is a writer, communicator, and storyteller who is passionate about using words to help drive positive change. She holds a bachelor's in English Creative Writing and Communication Studies and lives in Denver, Colorado. In her spare time, she's usually somewhere outside (preferably in the mountains) — and enjoys poetry and fiction.

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