Financial Wellness Assessment

Survival Stage

If you’re in the Survival Stage, you’re focused on meeting basic needs like food and shelter, possibly living paycheck to paycheck (or close to it), and sometimes fall behind on payments. You’re certainly not alone. As the cost of living expenses continue to rise, a growing number of American households are finding difficult to ensure the lights are on and their bills are paid on time.

Your primary financial goal is to find your footing and build a solid financial foundation of fundamentals like how to create a budget, how borrowing money works, and why your credit score matters. You may also need to seek professional intervention for getting rid of your current debt having a fresh financial start.

Stability Stage

If you’re in the Stability Stage, you usually pay your bills on time but may occasionally fall behind every now and again. It’s not unusual for you to rely on credit cards to help you get by. When you do, you probably tend to carry a balance, more often than not paying the minimum balance. If you paid more, you’d risk overdrafting your bank account.

Your primary financial goal is to decrease your reliance on borrowing money. This will make late fees and missed payments a thing of the past and save you more money in the long run.
To do this, you should focus on establishing an emergency savings fund and paying off existing debt. Finding money to put aside for these endeavors will likely involve rebalancing your budget and taking a hard look at your spending habits.

If your credit score isn’t where it should be, now is the time to identify what actions you can take to improve it and prepare yourself for more advanced financial goals like buying a home.

Growth Stage

If you’re in the Growth Stage, you’ve demonstrated excellent control over your finances and can handle your financial obligations with ease – without relying on credit cards or loans. Your credit score is in a good place and you have developed good credit usage habits like always paying your bills on time and paying more than the minimum balance.

Now, it’s time to shift your focus to long-term financial planning and preparing for the future for loftier goals such as buying a home and saving for retirement. These are important milestones that will generate wealth for you and your family down the road.

Independence Stage

Congratulations! If you’re in the Independence Stage you likely have little to no debt, a very healthy credit score, and both emergency and retirement savings. Your finances can handle anything life unexpectedly heads your way.

Having met all the tenements of financial preparedness, you are in a rare position to focus on growing your wealth. Look into passive sources income like investing, starting your own business, or purchasing real estate. It’s also a good opportunity to rebalance your investment portfolios so that they reflect the level of risk you are capable of undertaking.