What is financial wellness? Here’s how to improve your relationship with your money

Fed up of money worries? Here we show you how financial wellness can improve your financial satisfaction, while reducing stress.

6 min read

Financial wellness is like a fitness plan to improve your relationship with money, no matter what your financial situation is. In this article, we’ll show you the clear steps to develop a financial wellness plan and boost your money management skills—all while reducing your stress levels in the process. So put on your gym clothes, stretch out, and let’s begin.

Understandably, all of us have money worries now and again. But just like how eating healthily and exercising makes us feel good in our bodies, positive money habits help us feel financially well. Like a fitness plan, financial wellness covers routines and behaviors that make you feel more satisfied with your financial situation: whether feeling secure in your financial future or paying bills on time. And, of course, being able to afford things you enjoy, from holidays to the occasional shopping binge.

If you’re not used to taking control of your finances in this way, it might sound intimidating. But it’s never too late to learn positive habits that will enhance your relationship with money—and you don’t need a degree or financial advisor, either. The main habits of financial wellness are fairly straightforward, and include:

  • Spending wisely and within your means.

  • Having an emergency fund.

  • Having access to tools and education to make beneficial financial decisions.

  • Having a financial plan for the future, including a budget and financial goals.

  • Understanding how emotions affect money management.

But, before we continue, did you know that financial wellness isn’t always directly linked to how much you get paid? In fact, a recent report even found that people who earn over €100,000 had the same money worries as those earning below €10,000! This shows it’s our relationship with money, not the income itself, that makes all the difference.

We all need money to pay bills and to enjoy life. And let’s admit it, all of us would love to have millions more in the bank! But good money management involves simply making the most of what you have. It’s knowing how much you have to spend, making wise financial decisions, and being aware of upcoming bills and debts to pay. The way you manage your money has a drip-down effect in your lifestyle and stress-level.

There’s only one problem—we aren’t taught financial wellness at school, so not everyone understands the impact of creating positive money habits. The millennial generation have it extra tough, too, with high house prices, student debt, and large numbers of unemployment. It’s no wonder financial stress is an issue...

For example, many millenials are in debt, and a third run out of money before payday. This is concerning, especially given that people with poor financial wellness are four times more likely to have additional mental health problems. It’s clear money doesn’t buy happiness, while money problems can make us unhappy. Fortunately, financial wellness behaviors and practices can help.

N26 Metal card.

Did you know your emotions can influence how you manage your money? According to mental health charity Mind, poor mental health can make money management harder, while worrying about money can make mental health even worse. Tackling mental health and financial management in harmony is key to financial wellness. The better you handle emotions, the better decisions you make, and the more financial knowledge you have, the more confident you feel.

It helps by knowing that if you worry about money, you’re not alone. On average, workers spend three hours per week and one sick day per year to deal with financial issues. And all of us stress about money for lots of reasons, from struggling to pay bills or being confused about the best way to budget.

Sometimes situations are outside of your control, such as a job loss or financial emergencies. But regardless of your circumstances, by educating yourself and learning how to manage your emotional responses to money, you can seize back control. When financial struggles arrive, you then have the tools to respond with confidence. This is where money mindfulness comes in...

Money mindfulness helps you become more aware of how you spend, save, and invest. With increased awareness, you have more freedom to manage money masterfully, without acting through impulses or avoidance.

Emotions impact money management in a number of ways. For example, spending can provide a temporary “high”, which explains why many of us indulge in a retail binge when we need cheering up. We can make impulsive purchases of things we want, but don’t really need. On the other hand, an unexpected bill or unpaid taxes can cause immediate anxiety or stress.

Mindfulness is paying full attention to the present, without judgement. Meditation is a way to practice mindfulness, before applying those skills to your day-to-day life. When it comes to money, it can be hard to stay present when feeling stressed or wanting to avoid checking your bank balance. Mindfulness teaches us to confront difficult feelings, breathe, and enter the right frame of mind to face challenges head-on.

When it comes to money, meditation won’t make money magically appear in your bank account or wipe out your student loan. But it can teach you to reduce stress, boost self-awareness, and improve focus and decision-making. Money mindfulness has far-reaching benefits. As financial consultant Kristi Nelson writes on Mindful, “we can befriend what we have been ignoring, release myths we’ve been harboring, and live more fully the life we want.”

Mindfulness makes us aware of our beliefs and emotions related to money. That leaves no place to hide for things we’ve been avoiding or ignoring. By challenging these beliefs and managing our emotions, we are free to make better decisions and generally reduce levels of anxiety around dealing with money.

Money mindfulness helps boost positive emotions. And most importantly, the following points will reduce financial stress in the long term:

  • Learn how to budget: this will give you more control over your finances, allow you to spot where you’re overspending, and help you reach your financial goals.

  • Have a financial plan: a financial plan outlines the steps needed to improve your financial wellness. It includes a budget, goals, saving amounts, and assessing ways to reduce outgoings or boost income.

  • Set realistic financial goals: it might take time to pay off debt, learn new habits, or start saving. Unrealistic goals make it more likely to become disheartened. Instead, set specific goals that are also attainable.

Finally, financial wellness is a marathon, not a sprint. If you’re struggling with your finances, aim for small victories along the way—don’t expect to transform your relationship overnight. As we conclude, congratulate yourself for reading this article, and taking one step closer to achieving ultimate financial well-being.


We care about your financial wellbeing, and believe your bank account should offer plenty of smart features to help you achieve it. With N26, did you know that you can enjoy instant notifications after all account activity, and create Spaces sub-accounts for emergency funds, bills, savings, or simply your next big purchase? Sign up to N26 today for a great way to kick-start your financial fitness journey, become more mindful of your cash, and improve your money management.

By N26

The Mobile Bank

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