Financial well-being: feeling secure, not just having money

Financial well-being is about more than income or balance; it’s about feeling secure and in control. Here’s how it’s measured and built.

What is financial well-being?

According to the CFPB⁠(opens in new window), financial well-being is a state in which a person can fully meet current and ongoing financial obligations, feel secure in their financial future, and make choices that allow them to enjoy life. This definition deliberately goes beyond income or net worth alone, capturing a more holistic, subjective sense of financial security and freedom that two people with similar incomes can experience quite differently.

How financial well-being is actually measured

The CFPB developed a 10-question scale specifically designed to measure financial well-being consistently, producing a score between 0 and 100 based on responses about control over finances, capacity to absorb a financial shock, progress toward financial goals, and the ability to make choices that allow enjoying life. Most people’s scores fall somewhere in the middle range, and there’s no fixed cutoff separating a “good” from a “bad” score, since the scale is designed to track relative change and comparison rather than to label anyone definitively.

Financial well-being while supporting family abroad

For many immigrants, sending consistent financial support to family abroad is deeply tied to their own sense of financial well-being, not necessarily in tension with it, since successfully meeting that commitment reliably can itself be a significant source of security and pride, closely aligned with the CFPB’s own definition of making choices that reflect one’s values and goals.

For concrete tactics that support this sense of control, see these 6 ways to prevent unnecessary spending⁠(opens in new window).

Quick calculation

Imagine two people each earn an illustrative 3,000 units of monthly income. One has built a small emergency fund, sends a planned, sustainable 300 units to families abroad, and has 200 units left for discretionary spending after covering essentials, experiencing a reasonable sense of control and security despite a moderate income. The other earns the same amount but has no emergency reserve, sends an unplanned, inconsistent amount to family whenever asked, and frequently runs short before the next paycheck. Despite identical incomes, the first person likely reports considerably higher financial well-being, illustrating that the CFPB’s definition captures something meaningfully different from income alone.

Building financial well-being through small, consistent habits

Financial well-being tends to build gradually through small, consistent habits, an automatic savings transfer, a realistic budget that includes actual priorities, a manageable debt repayment plan, rather than requiring a dramatic income increase to improve meaningfully. This is genuinely encouraging for anyone who feels their income alone limits their ability to feel more financially secure, since the CFPB’s own research indicates that behaviors and habits, not income level alone, meaningfully predict financial well-being scores.

Why financial well-being varies even among people with similar incomes

Two people with nearly identical incomes can report very different financial well-being, since factors like debt levels, family financial obligations, unexpected expenses, and even personal attitudes toward money all shape this subjective experience beyond income alone. This is part of why financial well-being is measured through a dedicated scale rather than simply inferred from income or account balances, since those numbers alone miss much of what actually determines how secure and in control someone feels about their financial life.

Financial well-being isn’t static, and that’s a good thing

Because financial well-being reflects current circumstances and habits rather than a fixed personal trait, it can genuinely improve, sometimes meaningfully, through deliberate changes even without a change in income. Someone who builds a small emergency fund, pays down a stressful debt, or simply gains more confidence navigating a specific financial system after a period of uncertainty often reports a real increase in their own financial well-being, even if their paycheck looks identical to a year earlier. This is genuinely encouraging news for anyone feeling that financial well-being is permanently capped by current income, since the CFPB’s own research points toward habits and control, not income level alone, as major drivers of this measure.

Financial well-being and mental health

Financial stress and mental health are closely linked, and research consistently shows that improving financial well-being often correlates with reduced anxiety and stress more broadly. If financial worry is affecting daily life significantly, addressing the underlying financial situation through the concrete steps discussed here, alongside seeking support from a mental health professional if needed, can meaningfully improve both dimensions together rather than treating them as entirely separate concerns.

Talking about financial well-being with your family

Financial well-being is often treated as a private, individual topic, but for many immigrant households it’s genuinely a shared, family-level experience, since one person’s financial stress or security tends to ripple through the whole household. Having an occasional, honest conversation with family about how everyone is genuinely feeling financially, not just the numbers themselves, can surface support needs or concerns that a purely individual view of financial well-being would miss entirely.

In Summary

Financial well-being captures something income alone can’t, a genuine sense of security, control, and freedom to make choices that reflect what matters most, including supporting family abroad. Building it through small, consistent habits, rather than waiting for a bigger income, is both realistic and genuinely effective. See how much you can save on your next transfer as part of a financial plan that supports personal well-being alongside family’s.

This publication is provided for general information purposes only and is not intended to cover all aspects of the topics discussed herein. This publication is not a substitute for seeking advice from an applicable specialist or professional. The content in this publication does not constitute legal, tax, or other professional advice from Remitly or any of its affiliates and should not be relied upon as such. While we strive to keep our posts up to date and accurate, we cannot represent, warrant, or otherwise guarantee that the content is accurate, complete, or up to date.