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According to a 2015 report by the Center for Financial Services Innovation, more than half of the U.S. population is struggling financially. That’s 138 million Americans with insufficient savings, spending more money than they make, or carrying an unsustainable load of debt. Communities everywhere are underserved, financially uneducated, and as a result, lack financial health.
I grew up in such a community, raised on a farm in small-town Appalachia. It’s the kind of town with only a handful of stoplights and a single, less-than-super Wal-Mart. The majority of my classmates, including myself for most of my time in school, qualified for free or reduced lunches. The only restaurants that ever made it beyond a year in our town were fast-food chains; local shops and diners closed almost as quickly as they opened. My town isn’t much to brag about, but it’s where my family and heart remain.
My dad broke the mold as a first-generation college student when he obtained his Bachelor’s degree at a local university. Even though he hated the idea of me leaving home, he always emphasized the importance of a good education. My dad was no financial guru; he didn’t know a lot about money and all the financial resources available, but he made it a point to teach me as much as he could, encouraging me to “invest” what little I had in savings into a certificate of deposit account at our local bank to earn interest.
I didn’t know much about money, except that everyone needed it, and no one ever seemed to have enough of it. My dad taught me that money isn’t everything in life, but it is necessary to take care of yourself and your family. He would always say things like “Money makes the world go ‘round,” and “People who study money, make money.”
Money Lessons: Take 2
After high school, I went on to study personal finance, where I quickly learned that everything I knew about money was wrong. Up until then, I had always thought that “financial health” meant having a good credit score, owning a home, and being able to afford nice things like fancy cars and exotic vacations. Little did I know, many people who appear to be in good financial health are part of the 57% of struggling Americans.
Today, my definition of financial health looks a bit different. I don’t own many nice things, I can’t afford fancy vacations, and home ownership is a far-off destination. But am I financially healthy? Some might say so. I earn enough to cover my expenses and pay my bills on time. I have a comfortable amount of savings, a good credit score, manageable debt, and I can rest assured knowing that if I get sick or have an accident, my insurance will protect me from incurring much more. However, financial health doesn’t stop there.
Spreading the Word
Much of the reason communities across America suffer from poor financial health is due to a lack of resources and information available. The financially uneducated hold the same ideas about financial health as I once did, measuring success by status symbols such as cars and homes. But the most important thing I’ve learned about financial health is that it isn’t about what you own. In fact, it’s not a destination or a state of being at all; rather, it’s a journey, constantly changing and molding throughout our lives.
Financial health isn’t just about being comfortable in the now; it’s about planning for the future, creating the resources to achieve your life goals, whether that’s paying for your children’s education or ensuring your loved ones are taken care of after you’re gone. Financial health is having the opportunity to put your money where your heart is. For me, that means giving back to my family and my community, without which I wouldn’t be where I am today. That’s my take on financial health.
If you’re reading this, it’s up to us to spread the word about what financial health is and why #FinHealthMatters.~138M US adults are struggling financially. Join @CFSInnovation in promoting #FinHealthMatters Day!Click To Tweet
What does financial health mean to you?
I’m a financial coach and author + owner of Goodbye to Broke. I love all things personal finance, money management, and healthy living. And I talk to my dog way too much, if we’re being honest.