What is a financial wellness assessment?

A financial wellness assessment is fundamentally an evaluation of a client's financial health. This comprehensive assessment entails reviewing various aspects of an individual's financial situation, including income, expenses, savings, debt levels, and investment strategies. The goal is to determine how well the client is managing their finances and to identify areas where improvements can be made to enhance overall financial well-being.

This process provides valuable insights into a client's financial life and helps to establish a baseline from which to create personalized financial plans. By understanding the current state of a client's finances, advisors can tailor recommendations that align with their goals and needs, ultimately supporting the client in achieving financial stability and security.

In contrast, evaluations of a client’s legal status or audits of past investments do not focus specifically on the entirety of a client's financial health. While an assessment of risk tolerance may play a role in some aspects of financial planning, it does not encompass the broad evaluation that a financial wellness assessment provides.