Northeast Wisconsin
  • Northeast Wisconsin
  • January 2014
Written by  Alan M. Zierler

Financial wellness

For many, the new year is a time for starting over and making resolutions. As it has been for several years now, according to the Journal of Clinical Psychology, the number one New Year’s resolution in the United States in 2012 was to “lose weight.” Number three on the same list was to “spend less, save more.”1 Clearly, physical and financial wellness are on the minds of Americans.

Along with their place among the top three, the weight loss and spending/saving resolutions are comparable in other ways. First, both are easier said than done. Next, each takes planning and perseverance in order to see results. Last, but not least, true success is only achieved by keeping your resolution over time.

The American Heritage Dictionary defines wellness as, “The condition of good physical and mental health, especially when actively maintained by proper diet, exercise and avoidance of risky behavior.” Financial wellness, then, could be described as the condition of good financial health, especially when maintained by proper planning, money management, and daily application or exercise. Like physical wellness, attaining financial wellness is more of a lifestyle shift than simply following the latest fad. It takes determination among other things, and focuses more on the “slow and steady” approach, with small course changes eventually making a big difference.

As with weight loss strategies, the way you think about your finances can impact your desired outcome. It’s a matter of mindset. For instance, when cutting calories, you can either “follow an eating plan” that puts you in control or “go on a diet,” which seems more restrictive. The same is true when trying to get into financial shape. One may be more likely to remain on a “spending plan” than to “stick to a budget,” but both help you curb your expenses and build your savings.

Four key components of long-term financial wellness include determining wants versus needs, spending less than you make, setting savings goals and creating a spending plan.

Needs versus wants

Determining needs versus wants isn’t always as easy as it sounds. For example, when asked by a teacher in her personal finance class whether she needed or wanted a pair of $150 jeans from a high-end retailer, a high school student quickly responded that she needed them. Even as several of her classmates disagreed, the young woman insisted that she needed the brand-name pants. When figuring out needs and wants, it’s important to be as honest and objective as possible.

Spend less than you make

This is one of those self-explanatory principles, but in today’s credit society, it’s easy to get into debt without thinking of it as such. Just because you can afford the minimum monthly payment on your credit card doesn’t mean you should “charge it.” It’s better to save before you buy an item and pay in cash. Instead of paying interest charges, you could tuck the extra money away in a savings account for future needs or wants.

Set savings goals

Setting goals helps motivate people to save. One of your first savings goals should be to establish an emergency fund. The rule of thumb is to set aside three to six months’ worth of living expenses and only use that money for a true emergency, such as a job loss or medical emergency.

Other savings can be categorized as short-term, mid-term and long-term goals. Short-term goals would be expenses that are less than two years away, maybe saving for a car, a family trip, or other items or activities. Mid-term goals are usually a bit further out and may include saving for a down payment on a house, or paying for your child’s college education, a wedding or other big expenses. Long-term savings goals usually focus on retirement and involve investing. Check with a financial advisor to learn more about long-term investment options.

Create a spending plan

<p">Basically, a spending plan is a detailed listing of your income and expenses. If you have more expenses than income, you’ll need to reduce spending and perhaps even cut out some items completely. You could also increase your income by taking on a second job. For information about spending plans (budgets) and for other financial education tools, visit

“Like physical wellness, attaining financial wellness is more of a lifestyle shift than simply following the latest fad. It takes determination ...”

Alan M. Zierler is the president and CEO of Capital Credit Union, where he has been a board member for 24 years. He holds a bachelor’s degree in business management from Silver Lake College, and serves on the board of directors for Corporate Central Credit Union and the Community Foundation of the Fox River Valley, among others. Zierler and his wife, Judy, have been married for 35 years, and they have three children and nine grandchildren. Headquartered in Kimberly, Capital Credit Union has over $469 million in assets and serves more than 34,000 members.

Source: 1. University of Scranton, Journal of Clinical Psychology, December 13, 2012.

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