For many, the $1 million mark is seen as the ultimate financial goal—a benchmark for feeling truly wealthy. However, a recent Northwestern Mutual study reveals that only one in three millionaires actually feel rich. Financial experts say true wealth has more to do with your mindset and approach to money than hitting a specific dollar figure in the bank. Here, we explore three strategies from certified financial planners to help you feel financially secure, regardless of your net worth.
Rethink Wealth: It’s About Your Financial Journey
Rather than focusing on accumulating a fixed amount, like $1 million, financial planners recommend setting personalized financial goals that suit your needs and lifestyle. “Wealth is a relative term,” says Paul Morrone, a certified financial planner in Connecticut. It depends on factors like lifestyle, spending needs, and sources of income, which vary widely from person to person.
Rachel Elson, a CFP based in San Francisco, emphasizes the importance of understanding your own financial roadmap rather than just chasing a round dollar figure. Establishing goals such as building an emergency fund or improving your credit score can be more rewarding and practical than merely aiming for a high net worth. This approach helps shift your focus from accumulating wealth to making meaningful financial progress.
Leverage the Power of Time
You don’t need to have a million dollars in your account today to start feeling financially secure. If you’re in your 20s or 30s, the key is to take advantage of time. Consistently saving and investing, even in small amounts, allows compound interest to work in your favor, potentially turning modest contributions into substantial wealth over time.
Elson recommends automating your savings through pre-set 401(k) contributions or payroll deductions to ensure consistency. “Anything that you can do to put a process in place and a system you don’t have to think about is going to help you,” she says. Small, regular contributions can make a significant impact over the long haul, offering you greater flexibility and peace of mind down the road.
Work With a Financial Planner for Personalized Guidance
Having a large sum of money doesn’t guarantee financial security if you don’t know how to manage it effectively. “That’s where a financial planner comes into play,” says Elson. An advisor can help you understand what you have, explore strategies for growth, and navigate unexpected life changes. This guidance ensures you stay on track with your financial goals and helps you make the most of your resources.
Financial planners add value by providing ongoing support and advice tailored to your specific situation. Whether you’re working toward buying a home, saving for retirement, or simply reducing financial anxiety, understanding your individual road map can offer significant benefits. Celebrating smaller financial achievements, like setting up automatic payments or improving your credit score, can also boost your sense of financial well-being.
Shift Your Focus: Celebrate Small Wins Along the Way
Feeling wealthy isn’t just about hitting a big number in your bank account. Acknowledging smaller financial victories can be just as important. As Morrone points out, “There’s always going to be someone with more.” Instead of comparing yourself to others, focus on the progress you’re making toward your own financial milestones.
By celebrating achievements such as reaching a savings goal, sticking to a budget, or paying off a debt, you’ll be more likely to feel financially empowered. These small wins can make the journey toward larger financial goals more rewarding and help build a sense of true wealth and security.
Financial security is not just about accumulating wealth; it’s about how you manage and perceive your money. By setting personalized goals, leveraging the power of time, and working with a financial planner, you can build a financial strategy that makes you feel wealthy, regardless of your account balance. Ultimately, it’s not the amount of money that matters, but the steps you take to ensure your financial well-being.
