From our archive. This article was published on 20 July 2020. Rules and amounts may have changed since.
Social cohesion is a key pillar in many governments’ visions of how we will live together in the future. It is the extent to which people express, in behaviour and experience, their commitment to societal bonds in their personal lives, as citizens in society and as members of the community. This shows in individual life chances, the liveability of a neighbourhood, caring about older people in your area and looking after others. Social cohesion helps people get ahead in life. It is important for social embedding and support, creates group solidarity, fosters trusting relationships and promotes the well-being of individuals and societies. Social cohesion is the necessary glue to guarantee a “warm” realisation of our dreams for the future.
Source: https://www.vlaanderen.be/vlaamse-regering/visie-2050/samen-leven-2050
Social cohesion begins in the living room with your own family and then extends to relatives, friends, the people in the neighbourhood where you live, and so on. That is why we would like to draw attention here to the concept of “family financial well-being”. In these challenging times, people who have a good family network should come together as a team (in their own home) and work on the total well-being of every family member or good friend. If you do not have this network, work on your relationship with your family and friends, precisely in these difficult times. Seize opportunities. Yes, this is the moment to call that person you have not seen for a long time to ask how they are doing and whether they are safe and well. Build your social network by helping others: this will contribute to their well-being, and by doing good you will feel better yourself too. If you feel good and have done good things for other people, the universe will give you much more in return. The following factors play a role in your sense of (financial) well-being:
Societal factors refer to the health of the economy in general and the public and private mechanisms within the economy that support us financially. Our social system in Europe is a good thing. It was introduced in the 19th century by Otto von Bismarck, Chancellor of Germany, who used it to appease the working class and weaken support for socialism. But that is a subject that would take us too far… we are not talking about politics, but about well-being.
Losing a job, for example, is a terrible thing to go through, but it would be much worse if we did not feel secure in the knowledge that there are government benefits that can help us through this period of unemployment. Knowing that there is support for people in financial difficulty can contribute to our overall well-being and counter financial stress. Support from the government, social institutions and family members is crucial, even if we cannot meet in person.
Household factors are a more personalised set of circumstances. They may relate to our income, savings, wealth, health or debt obligations, or those of the people we live with. Your social environment. If you have a large mortgage compared with your income, for example, that can have a negative effect on your sense of well-being. During the coronavirus pandemic, many financial institutions offered the option of temporarily freezing capital repayments on mortgages. Even outside a crisis, it pays to talk to your lender in good time if you have difficulty making payments.
Individual factors are the most personalised influences on Financial Well-Being, your feeling or degree of financial well-being. This can be your knowledge of the financial system and the economy, or simply your personality, your passion, your motivation, your work ethic, your saving and spending habits. If you are by nature a rather nervous or anxious person, it can be harder for you to feel financially healthy than it is for someone who is naturally more confident. The level of financial stress and the way we deal with it differ from person to person. It also depends on the stage of life you are in. A person of working age may feel more financially secure than someone who is retired, simply because of the advantage of a steady income from work coming in.
All these factors contribute to everyone’s sense of financial well-being and welfare.
This is a difficult time for all of us, and we cannot get around that. But with a good understanding of how these factors affect how we feel about money, we can understand how to improve our personal or family situation and feel more financially secure. And that is the first step towards building our long-term success through investments!
Financial Well-Being is linked to various factors that each contribute to it. Would you like to build your sense of financial well-being? Would you like to find out more? Then get in touch with the Financial Well-Being Academy for more information, or contact Het Financieel Huis via this contact form or by email: info@financialwellbeingacademy.com, or go to the page of one of our partners.