Written by Cathy Goddard, Lighthouse’s Founder: Tips to Improve Your Financial Well-Being
Does money buy happiness?
Are you happy with your income? Do you believe getting a raise would make your future brighter? You’ve probably heard the old adage, “money can’t buy happiness” but many sure would like to find out.
A recent analysis conducted by Advisor Perspectives shows more money can equal more happiness at certain income levels. Apparently as people earn more money, their day-to-day happiness rises. Until you hit $75,000. After that, it is just more stuff, with no gain in happiness.
Perhaps $75,000 per annum is not your reality and the chances are fairly good that is the case in Whistler. Especially when you consider that, according to Statistics Canada, the average wage for Canadian employees as of September 2016 was $986 per week – or just over $51,000 a year.
What about spending habits?
These may be dire statistics but what is perhaps of even more concern is that almost half of all Canadians spend more than they earn every month, and continue to sink further into debt with no plan of getting on top of their finances. The statistic comes from a recent Canadian Payroll Association survey – 47 per cent report they would be in financial difficulty if their pay cheque was delayed by even one week and 35 per cent are overwhelmed by their debt.
Former Money Coach Kathi Bridge has witnessed first hand the negative impact that clients face when they keep adding debt each and every month. She suggests that people need to make a plan for spending and saving with positive and rewarding goals to work toward.
Your money success formula
The success formula she shares with her clients is that in order to get rid of debt, people have to first stop adding more debt. Monthly cash flow (what’s coming in and going out of your account) must be a balanced amount whereby you live within your means.
This plan must also include those bills that only come up annually or a few times a year – like property taxes or ski passes. Determine how much you need each year for these less frequent payments, divide by 12 and set up an automatic transfer to a savings account.
This works great for your goals as well – whether it’s a vacation or saving for a special item you want. Open a free high interest savings account and nickname the account for your specific goal. Automatically transfer money to your savings account each payday.
Once you aren’t adding to your debt each month, it’s time to pay down what you owe. Set a debt free date with an online debt payment calculator. Include the debt repayment in your spending and savings plan and automatically transfer some money to your debt with every pay period.
A financial plan for your financial well-being
But when it comes to money, people all too often don’t build a financial plan that includes living within their means, paying down debt and saving for a fun goal. Bottom line is that people’s financial well-being depends on their ability to understand and use financial information in a way that helps them make good decisions.
That’s why I’m hosting a free online session on June 9th with Jennifer Underwood, a Wealth Planner at Vancity and Ruby Saroya, Business Account Manager at Squamish Savings. You can learn more here but basically, you will be guided through a presentation jam-packed with information, resources and tools – then we will open it up to your questions. Ask them ‘live’ or send them to me beforehand and we will get answers for you anonymously.
My mission is always to provide a safe, comfortable learning environment so this is NOT a ‘sales’ event. Instead, this is an opportunity to learn budgeting strategies, key considerations about investing and resources to protect yourself with insurance options and an estate plan in place. Oh, and a bonus will come your way too! Register for your free ticket right here.
Don’t shy away from this question because I’d love to know: What is your biggest hurdle when it comes to your finances? Comment below or reach out to me confidentially.
2 thoughts on “Tips to Improve Your Financial Well-Being”
Improving one’s financial health can be as simple as cutting down on frivolous spending. While it’s good to treat oneself now and again, going too overboard, in this regard, can be an issue.
I agree 100%. It seems that wants and needs are convoluted in this day and age. Awareness and honesty are key! Thanks for sharing Carola.