Australian framework for financial wellbeing

Money matters. It can determine how we live, how stressed we feel and what options are available to us, now and in the future. The ability to manage money and cope with unexpected financial shocks is important for individuals, households and the economy.

Around the world, programs are attempting to improve financial capability, inclusion and resilience as a way to improve financial wellbeing. These efforts are occurring across Australia, such as the National Financial Literacy Strategy and the Financial Inclusion Action Plan.

But what does financial wellbeing mean?

Definitions of financial wellbeing have begun to emerge internationally. This project, commissioned by Financial Literacy Australia, looks at financial wellbeing in the Australian context. It provides a definition that aims to be relevant to Australians of different ages, and meaningful to organisations that work to improve financial outcomes. The project asked:

• What is financial wellbeing, and what are its different parts?
• What are the factors that influence financial wellbeing?
• Where does financial capability fit in?
• How can we measure financial wellbeing?

The study used data from an international literature review, focus groups and interviews with 72 people, a survey of 821 people living in Australia aged 18 and over, and consultations with experts in the field.