Six steps to Financial Wellbeing

Posted by in

22m working-age adults do not feel that they understand enough about pensions to make decisions about saving for retirement.

This statistic has recently been published by the UK’s Money and Pensions Service. We are supporting their #TalkMoney #TalkPensions awareness week, which is running from Monday 18 November through until Friday 22 November 2019.

The theme for this year’s #Talk Money #Talk Pensions Week is Financial Wellbeing.  The concept of financial wellbeing is about people feeling secure and in control – knowing that not only are they able to manage day-to-day and deal with the unexpected, but that they are also building towards a healthy financial future.

Our Client Strategy Director, Malcolm Steel’s Financial Wellness seminar breaks down the key actions you need to take to help you achieve financial wellness into six steps.  To support #TalkMoney #TalkPensions week, we have drawn the six key steps together below.

Step 1 – Have an emergency fund

This is a store of capital that you can access fairly quickly in the case of an unforeseen circumstance such as a boiler repair or loss of job. It can be very reassuring to know that you have this in place. The amount to set aside will be different for everyone but as a rule of thumb, three month’s salary is often suggested.

Step 2 – Protect yourself and your family

Through various types of insurance policies. There are two main categories of policies that you can take out:

When you are considering what you should have in place you need to think about who also relies on your income, other than yourself.

Step 3 – Deal with debt

Especially unsecured debt. Review it. Clear it. Look to transfer it. Avoiding it in the first place would be even better.

Step 4 – Save and invest well

Don’t hold too much in cash– this is an inefficient type of investment for long term savings, especially when you take into account inflation, which will erode its value.

Think about asset allocation. You may need to take a longer-term perspective and accept a level of volatility.

Lastly – the earlier you start the better.

Step 5 – Keep everything in good order

Consolidate – the advent of platforms has helped people consolidate investments, pensions and other assets.  Check before you do consolidate that any older policies don’t have preferential terms or clauses that you might lose before you consolidate them.

Make sure you have a will in place and that it is up to date. Especially if you have dependants.

Consider putting in place a power of attorney – this is a good idea even if you are young and in good health

Tax – consider elements of tax planning, make use of tax reliefs on pension contributions, ISAs, inheritance tax etc.

Step 6 – Have a plan, review it regularly and take advice

Some final words from Malcolm: “Financial wellness is having enough money to live comfortably with little financial stress and time to enjoy life.”


Note that this article is not individual financial advice as we don’t know your specific goals or circumstances.

Newsletter Signup

We send out a quarterly newsletter. If you would like to receive a copy please sign up below.