Finances and health are two of the most important, yet sometimes controversial, topics to talk about depending on your audience. Many feel that it’s not polite to discuss salaries, net worth, and financial goals. It seems more socially acceptable to complain about not being paid enough, having too many bills, and saying words like, “I can’t afford that.” In comparison, it is not polite to ask someone’s weight (unless the person is under the age of 10) and people don’t really want to listen to what it takes to become and remain healthy, including diet restrictions and waking up at 5am to exercise. Financial health includes the overall status (aka, pulse) and details of how your money is working for or against you, to obtain both your immediate and future needs.
In defining what financial health means to me, I find three parallels with money and health.
#1 – Appearances can be deceiving.
Everyone knows that that keeping up with the Joneses can be very expensive, and as researched and discussed in one of my favorite books, The Millionaire Next Door: The Surprising Secrets of America’s Wealthy, most millionaires don’t appear rich. Expensive habits to achieve a perceived status can make you feel good now, but when you’re 65 years old and worrying how to pay for basic living expenses because you didn’t save enough in your younger years for retirement, other people’s perceptions of what kind of car you drive, the square footage of your house, and brand name of your clothing won’t matter.
Also, salary is not a good indication of wealth. What you really need to calculate is net worth, which is your assets minus liabilities. I’ve had clients who were surprised to learn that while they have a household income of $175,000+, they actually had a NEGATIVE net worth. Keeping a pulse on your quarterly and yearly net worth can help you determine if any changes are needed before it’s too late.
In parallel, “skinny” people are not necessarily the healthiest. I know plenty of friends and family who from a scale perspective were fine, but had high blood pressure and high cholesterol due to diet and other habits.
#2 – Success takes time and work.
People seem to want financial freedom and to get out of debt, but don’t always want to do the work to get there and stay within the boundaries of a budget (aka, financial diet). Creating wealth often means becoming the best at your job by reading and building skills in your off-time to have a better chance at promotions and higher pay. It can also mean sacrificing lifestyle (e.g. living with family, downsizing, moving to cities with lower cost of living) to build funds to start a business. Having your end goals in mind can make it easier to say ‘no’ to social pressures and invitations that cost time and money, distracting from what you really want in life. The little details really do matter and can add up to long-term success.
Relating to health, it takes time and commitment to live a healthy lifestyle. However, it is easier to make excuses and say that you’re tired and don’t have time to work out, as opposed to changing your schedule to work out before going to work or before the kids wake up. It can also be difficult to say no to treats or other foods that aren’t good for your body, but creating a menu plan and training for a purpose (e.g. marathon race, wedding, swim suit season) can create boundaries that lead to success.
#3 – Accountability is key to success.
To really succeed, find mentors and others who will help you towards financial freedom. You want people in your circle who will congratulate you for making a good financial decision, not tell you that you deserve that new, luxury car or give you a hard time for wanting to start a new business or side hustle. It also helps to hear what people did to become financially independent, and learn what not to do.
Financial blogs are great resources – you can follow others who were in your similar situation and succeeded in getting out of debt. To get a list of my favorite bloggers, organized by category and target audience, check out Rockstar Directory. You can also hire a money coach to become your accountability partner.
In comparison to health, many find that having a personal trainer is key to staying on track and working harder. Information and desire to change are often not enough, so find someone who will push you when things get tough.
In summary, financial health means understanding your current money status, as well as paying attention to the little details that contribute to long-term reality. Getting a baseline now and staying on track are easier when you realize that appearances don’t matter, success doesn’t happen overnight, and accountability is the key to long-term success.