To help you understand the health of your finances we have developed a Financial Health Score. This score measures how strong your financial position is across six areas that make up your overall financial wellbeing.
Using your financial data, we can calculate your Financial Health Score. To understand the score, we have used a scale from 1 to 100. The meaning of the scale is shown in the diagram below.
Understanding your financial health score
The Financial Health Score combines the health scores from various areas of financial wellbeing, such as cashflow and debt management. Each area's health score is determined by key metrics commonly used in their respective fields to assess financial health. These individual scores are then combined to calculate an overall health score.
These key factors are used to assess your financial health:
- Cashflow management – how much of your income is saved and the portion used to service debts.
- Debt management – how much debt you have versus your income.
- Investments – your investment knowledge and experience, level of portfolio diversification and progress on wealth accumulation.
- Risk management – the level of financial exposure and impact on your future earning capacity arising from disability and critical illness.
- Retirement planning – your projected income gap or surplus at retirement.
- Estate planning – the estate planning arrangements you currently have in place.
