5 tips from a financial educator on how to achieve financial well-being

In a world of ever-rising interest rates, inflation and the realization that $20 just doesn’t buy as much as it used to (even a year ago), the topic of financial well-being is top of mind for many.

The 2022 edition of UFlourish at the University of Calgary invited financial educator Mark Kalinowski from Credit Counselling Society to speak about money and, in particular, financial wellness.

At the outset of the webinar, Kalinowski provided a definition for how he thinks of financial well-being: “The extent to which someone is able to meet all their current commitments and needs comfortably and has the financial resilience to maintain this in the future.”

The financial educator’s presentation offered participants several takeaways that could be implemented relatively seamlessly into their lives to build financial well-being.

Here are a few ideas that could be added into people’s routines to make checking the bank balance a little less stressful.

Don’t discount credit counselling

The impression is often given that only people who are bad with money need credit counselling. Kalinowski demystified that notion based on his own company’s experience. “The people who come and see us are the people who have run into an issue that set them off-course,” he said.

Counselling services, Kalinowski said, can provide a sense of clarity, or give direction to one’s own financial well-being, while giving a sense of a person’s current status. He brought to light that seeking credit counselling should not be seen as a failure or negative as society may want us to believe. After all, Kalinowski said, we seek medical advice when we encounter health concerns, so seeking financial advice when having financial difficulties should be normalized.

Build in habits

Creating consistent habits, whether big or small, is critical to financial well-being, Kalinowski said.

For example, he said, if physical cash is your forte, start a habit such as putting some money away in something you can physically see and touch — like an old-fashioned piggy bank. Kalinowski presented a weekly savings challenge: start with $1 the first week, and increase the amount by $1 every week for 52 weeks (granted, the last few weeks may be challenging as you find yourself putting away more than $50 every seven days). By the end, that piggy bank will have more than $1,300 — enough for a vacation or to cover holiday shopping.

This challenge can also be accomplished through online banking, Kalinowski said, by setting up a separate savings account with automatic deposit. Bonus tip: it helps to name the account with something that builds in an emotional tie (e.g., “2023 Vacation Fund”).

Avoid borrowing when you can

The temptation to use credit for all our daily expenses can be detrimental to having a solid savings plan, said Kalinowski, as the amounts can add up quickly and result in overspending and borrowing. To create more space in our accounts so we don’t have to go into debt for purchase, Kalinowski suggested looking at ways to earn extra money such as dropping off a bag of bottles at the bottle depot or cutting out a lifestyle expense for the month (e.g., instead of buying a coffee from a café every morning, make your own at home).

Reframe your motivation

"It’s how we think and feel about money that lets us be effective savers or not," was something Kalinowski reiterated during his presentation. Financial well-being, he said, "has to do with how we perceive the world." Being able to see the value of saving (even if it’s a small amount) and how we strategize borrowing, he said, is a key indicator in financial well-being.

Save your extras

It can be challenging to come up with saving hacks while ensuring we aren’t compromising our standard of living. Kalinowski shared a few saving tactics that many of us can use:

• Save your pay raise: If you do find yourself lucky enough to have an annual pay increase, allocate that increase (or at least part of it) to your savings fund; try to save something each paycheque either way.
• Save your savings: If you’ve allocated $100 for something, but you find it on sale for $75, take the extra $25 and deposit it into your savings.
• Save a bit off the top: Speak with your bank to see if there’s an option to save your round-up (i.e., if something costs $12.20, take the extra 80 cents leading up to $13 and deposit it into a separate account).

Kalinowski ended his session with a final sum-up of financial well-being: "A good attitude, avoiding borrowing while meeting today's needs; when we can understand what makes us feel financially well, we can set goals and we can start working strategies to get there.”

A recording of Kalinowski’s presentation, Mind Your Money: Financial Wellness, is available for viewing.