Financial Wellness and Stability

12/1/2021

Everyone wants to be financially stable, the problem with that is the definition of financial stability is different for everyone.  Working with a financial professional in the pursuit of financial stability is a wise decision, but only if the investor is able to clearly articulate how they define being financially stable.

For 40 percent of wealthy investors financial stability means that they are comfortable supporting the lifestyle they want, according to Spectrem Group’s new report on Financial Wellness. Financial stability means having enough money that one can put some away for the future for 22 percent of investors. Thirteen percent of investors define financial stability as being completely free of any debt. Having consistent investment returns, keeping a budget, and increasing their standard of living are all not significant factors in the definition of financial stability.

Age plays a large part in the definition of financial stability. Baby Boomers and WWII investors overwhelmingly define financial stability as being comfortable in supporting the lifestyle they want to have. Gen X investors are more likely than other age segments to define financial stability as having enough money to put some away for the future. WWII investors are more concerned with having the resources to be able to pass money on to their heirs.

There are many different resources in helping ensure financial wellness and stability. A financial advisor is the most effective in helping ensure financial wellness according to wealthy investors, with 90 percent indicating they are effective in helping ensure financial wellness. The investor’s retirement plan provider is the next most identified source in helping ensure financial wellness. Seventy-three percent of investors feel their own personal research is effective in helping ensure their financial wellness.

It comes as no surprise that the reason why investors feel their financial advisor is effective in the pursuit of financial wellness is that the advisor’s primary focus is on the investor’s overall financial wellness. Nearly a quarter of investors feel their financial advisor is effective in ensuring their financial wellness because they offer reasonable suggestions to improve their financial wellness.

Given that financial stability and wellness is something we are all seeking, this should be a conversation that is had with financial professionals, not only to detail what financial stability means, but to allow those financial professionals the opportunity to help wealthy investors achieve financial wellness.