‘World Health Day: Prioritise Financial Health’

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By Mr. Vinit Kapahi, Head of Marketing, Aviva India

The last two years were no less than a rollercoaster for every one of us. We all saw something unexpected and recognized the importance of good health. But what does the word ‘health’ mean? According to the World Health Organization, the term ‘health’ is described as a “state of complete physical, mental, and social well-being and not merely the absence of disease and infirmity.” Certainly, one of the overlooked aspects in this definition is financial health.

Keeping this in perspective, This World Health Day, Mr. Vinit Kapahi, Head of Marketing, Aviva India, pens down the importance of financial health to keep you healthy, wealthy, and wise.

Financial Health

Your personal financial situation is your financial health. It considers elements such as investments, debt, savings, and retirement funds, to provide a comprehensive picture of your ability to fulfil your financial needs in the present as well as in the future.

While healthy financial well-being gives you financial security and independence, poor financial health can have far-reaching consequences that go beyond your wallet.

Monetary stress affects your mental and physical health which could affect your social life and relationships and lead to poor concentration and sleep deprivation.

Improve Financial Health

Planning is key when it comes to managing your personal finances. Financial planning entails a lot more than increasing your savings and reducing your expenses. It includes achieving your future goals, such as wealth creation, retirement planning, higher education, and more.

  1. Financial Education: Expanding your financial awareness and education is the first step in improving your financial health and overall monetary, emotional, and physical wellness. It can be tough to budget and improve your monetary decisions when you are not financially literate.
  2. Goals: Just like personal goals, financial goals vary from person to person. Setting a financial goal is a crucial step toward financial stability which starts with budgeting. According to your requirements, you can set short, medium, and long-term goals.
  1. Short Term Goals: Setting short-term financial goals gives you the confidence and set the foundation to reach your bigger goals. It includes paying off credit card bills, rent, utility payments, etc.
  2. Medium Term Goals: They are the next step towards your long-term financial goals and include paying off your home loan, education loan, etc.

iii. Long Term Goals: The long-term goal is your big picture. Achieving these goals can take years or even decades. The biggest long-term financial goal for most people is to save enough money for retirement.

  1. Risk Appetite: Risk appetite refers to how much risk you are ready to take in order to achieve your goals. As we grow older and as our income and family conditions change, our desire for risk can change. Understanding and analyzing your risk appetite allows you to make informed and transparent financial decisions.
  2. Funds: This entails determining where to invest money in the market for a fruitful return in the future. By allocating a portfolio’s assets according to your goals, risk tolerance, and investments, it seeks to strike a balance between risk and rewards.
  3. Insurance Cover: Once you have attained a healthy financial situation, you would want your family to continue enjoying the same lifestyle, even if you are not around. This is where insurance comes to your rescue in form of a pension plan, term insurance, unit-linked plan, etc. according to your need. Money from insurance can meet everyday expenses, relieve financial stress, and help you attain peace of mind. By getting life insurance, you are not only making sure of a better present, but also a financially secure tomorrow.

If you treat your money with the same love and care that you give to your body and mind, it will undoubtedly multiply. For solid financial health, let us take a pledge to take the first step towards educating ourselves about money, improving our financial health, and securing our family’s future.