Individual, Social, and Environmental Determinants of Financial Wellbeing

Financial Wellbeing

Financial Wellbeing has been described as the extent to which someone is able to comfortably meet current, ongoing, and unexpected financial obligations and has the financial resilience to maintain this ability in the future (CFPB, Kempson, et al.). The concept of financial wellbeing has evolved from the fields of economics, personal finance, psychology, health and wellbeing and has gained prominence in research, policy, and industry over the last few years.

From early depictions of ‘financial literacy’ – individual knowledge and skills in money management to ‘financial capability’ – taking action and adopting specific behaviors when and where one has the ‘opportunity’ to act on knowledge, FWB has grown to include external socio-environmental factors such as household, institutional, and community influences as well as internal psychological traits, attitudes, beliefs, and values. While financial wellbeing will be different for everyone, it should be understood within the context of an individual’s life within a household, community, and society and include both objective and subjective indicators.

Adopting a broader, more holistic view is important when we want to understand and address the root causes or modifiable factors of an individual’s financial health and wellbeing. Many financial interventions seek to boost literacy, persuade against buying lattes, or provide tools or automation services to make beneficial behaviors like budgeting, paying bills, or saving for retirement easier to do. While these are all good things (perhaps we’ve over poured on the lattes?), they can be overly focused on individual capability and responsibility, failing to recognize and intervene upon the larger network of factors that need to change if we truly want to make a difference in people’s lives.

Our “FWB Determinants 1.1” was built from a (quite) rapid evidence-review and presented at Mad*Pow’s annual Financial Experience Design conference in 2018. Since this version, we’ve been head’s down deep into field research, literature, and intervention studies on the topic. Look for a much more robust v2.0 from us in October 2019 and hopefully some innovations in the marketplace. 

To see the FWB Determinants 1.1 please fill out the form below.


Contributed by
Dustin DiTommaso
Job Title
SVP, Behavior Change Design