This week, Craig Siminski, of CMS Retirement Income Planning, shares an article discussing four elements of financial well-being and offers suggestions to strengthen financial wellness:
If we’ve learned any lesson over the past year, it’s that no matter how carefully we plan and prepare, we’ll likely encounter unexpected hurdles. While a global pandemic has certainly underscored the need to pay close attention to our physical wellness, it has also revealed the need to shore up our financial wellness.
According to PwC’s 9th Annual Financial Wellness Survey conducted in January 2020, financial matters were the top cause of stress for employees even well before the pandemic hit in earnest. More than one-third of full-time employed millennials, Gen Xers, and baby boomers had less than $1,000 in emergency savings. Only 29% of women said they would be able to cover their basic necessities if they found themselves out of work for an extended period, compared with 55% of men.
And more than half of millennials and Gen Xers and 35% of baby boomers said they would likely use their retirement funds for something other than retirement, with most noting it would be for an unexpected expense or medical bills.
Although tapping your retirement savings can help you get through a crisis, it can hinder your ability to afford a comfortable retirement. Having a plan to guard your financial wellness throughout your working years can help you avoid putting your retirement at risk.
What Is Financial Wellness?
The Consumer Financial Protection Bureau (CFPB) defines financial well-being as:
1. Having control over day-to-day and month-to-month finances. In order to achieve this, your expenses need to be lower than your income.
2. Maintaining the capacity to absorb a financial shock. This typically refers to having adequate…
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Craig Siminski is a CERTIFIED FINANCIAL PLANNER™ professional, with more than 22 years of experience. His goal is to provide families, business owners, and their employees with assistance in building their financial freedom.
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