Are you Financially “Whole?” Three Steps to Get There

Today we have the wildly cool opportunity to have Amber Erickson Gabbey, a writer, newly found Colorado resident, fellow graduate school peer of mine, and a gal who is taking on a topic that none of us love to talk about, but that affects of every dang day.

Health really has no boundaries.  Kind of a scary thought? Yep.  Our health is impacted by every aspect of our lives and financies aren’t getting away on this one.  No way.  

Hey Amber, thanks for tackling this topic for us.  We know it wasn’t easy.

When we think about wellness, it’s easy to look to the obvious facets: physical, mental/psychological and perhaps spiritual, but there are several other factors that influence our overall well-being. These include intellectual, occupational, emotional, environmental and everyone’s favorite, financial. Some facets affect health and well-being more directly than others, but they are all important in being truly healthy, well and whole.

Financial wellness is a tough one because most of us are never really happy with where we’re at. Financial situations change, stuff comes up, challenges arise and we may go from financially well to unwell, and vice versa, many times over the course of life. Start by asking yourself if you have enough money. If the answer is no, begin to contemplate why and what could change.

Being financially unwell is stressful and puts excess strain on our bodies, minds and spirits. It’s tough, I’m with you there. Money troubles seep into every area of life and have far more implications than we usually realize. Luckily, there is hope.

Remember that finances are a lifelong journey, don’t get overwhelmed. Just take it one step at a time. Here are three topics for you to consider in becoming more financially well:

Understand Your Whole Financial Picture

Finances don’t have to be complex, but you need to be aware of every piece of it and how it all works together. Take some time to look at everything you have, including:

   Checking Accounts

   Savings Accounts

   Credit Cards

   Store Credit Cards

   CD’s/Savings Bonds

   School Loans

   Car Loans

   Other Loans


   401K/IRA (Retirement)

   Employee Stock Plans


   Monthly Bills (Utilities, Groceries)

   Car Insurance

   Health Insurance

   Other Debts

Start by making a list of everything related to money in your life, without assessing or criticizing it. What are you spending, where is your money going and when or how frequently? What are you saving, into what accounts and how frequently? Consider keeping individual files to help stay organized.

Once you have your comprehensive list, sit with it. Think about it. Become friends with it. Nothing on that list is good or bad, it just is. Now is a good time to put some goals around this list. Spend time considering what your financial goals are – do you want to buy a home in the next year? Quit your job to go solo? Pay down debt? Simplify your finances? Make a note of these goals and what items those goals focus on.

To be truly financially well, we need to have a full understanding of our finances. That doesn’t mean our finances have to be perfect, but we need to be in a position where our finances aren’t controlling us, stressing us out or limiting our potential to reach our goals. What that means for you is yours to figure out.

Assess Your Finances

Once you have an idea of your financial picture, the next step is to assess those items. This might be a dirty process, but is necessary. Set aside some undisrupted time and start with the accounts you use regularly. For many of us, this is checking, savings and credit cards. Print spending reports or find statements for the past 6 months for all those accounts and dig into the details.

I like to go through line-by-line and categorize everything, starting with regular expenses, perhaps more of the ‘need’ items (rent/mortgage, utilities, groceries, gas/transportation, car payment, school loans, etc.). Move onto the ‘wants’ which may include shopping, personal care/beauty, dining out, entertainment, etc. This is where the cringing begins ($500 on Starbucks, yikes!) or you might begin to notice trends in your spending.

Next, go through and assess income. If you have a steady job, this will be easy, but for those of us with less traditional income streams, this is especially important.

The first rule of financial wellness is to make more than you spend.

Once you have your assessment done, set it aside (maybe make a cocktail) and give yourself a break. After a bit, go back and start making some decisions. Use your goals as a guide and go through one category at a time with a fine-tooth comb. Could you save on gas by taking the bus more or working from home? Could you eat out less, choose less expensive places or cut out the drinks/appetizer/dessert? Could you turn your heat down a couple of degrees to conserve energy? Could you cancel subscriptions you don’t use? Cancel cable? Lower your phone plan? Change to a bank with fewer fees? Is there cheaper housing available? Should you get another or a different job? If you have a surplus, are you putting your savings into the best places? Could you capitalize more on pre-tax contributions?

If you don’t like what you see, consider instituting a budget – as simple or complex as you see fit. This is your financially process, and you will need to find a system that is appropriate for you and sustainable.

Finally, assess your other accounts. For loans, retirement accounts and the like – stuff that doesn’t see a high volume of debits and credits – check for fees or charges, make sure you are paying it on time and make note of whether there is a way to minimize that amount. For loans, can you refinance at a lower rate or consolidate? Is there a credit card with lower interest rate?

Be Honest About Your Finances

This is the hardest of all for many of us. You’ve done all the work to assess your finances, you understand where your money is going and you see areas that need improvement. Now you need make peace with that and make the necessary changes. If you can’t pay off your credit card each month, don’t spend recklessly. If you are invited to do something outside of your budget, tell them you can’t afford to do it. The truth is, you can’t. So don’t go.

I know, I know, this is a major burden on your social life or fun, but it’s the truth and ignoring this fact or being in denial about your financial situation will only make it worse. Debt, or spending more than you make, is a major energy drain and is stressful. What if you could get rid of that debt just by staying home a few nights a week – worth it? I think so, but ultimately, that’s your decision to make.

You don’t have to make a lot of money to be financially well, you just have to be responsible about the money you do have.

It’s easier to be in denial or ignore our financial woes, but that isn’t serving anybody. It’s time to get well. Take control of your finances and begin taking small steps to get to where you want to be. Set your goals, create a budget, become intimate friends with your financial situation and begin on a path toward financially wellness. It may not be easy, but it’s totally worth it.