Healthy, Wealthy & Wise

Kate Chiu is a certified financial social worker and former global career planning specialist and Unit-in-charge at the Federation’s Wellness PLUS (Kowloon). She talks about financial wellness as the goal of financial literacy education, as well as a crucial aspect of personal wellbeing.

What is financial wellness?

Financial wellness is not just about “having the money,” but about “feeling in control.” When a person is able to manage both day-to-day and unexpected expenses with ease, and feels secure and empowered about their financial future, this sense of stability and freedom is what we mean by financial wellness.

According to the Organisation for Economic Co-operation and Development (OECD), financial wellness comprises three key dimensions, including the ability to meet current and ongoing financial obligations, a sense of security about the financial future, and the freedom to make choices that allow one to enjoy life.

From a youth development perspective, financial wellness begins with learning to manage money, progresses to developing independent financial values, and culminates in cultivating long-term planning and self-discipline. It is a holistic growth process that encompasses knowledge, behaviour, and mindset.

How does financial wellness differ from financial literacy?

Financial literacy is the gateway to financial wellness, but it is not the destination. The former focuses more on knowledge, skills and values, while financial wellness, however, involves how individuals apply this knowledge in daily life, how they build a healthy relationship with money. It even extends to how money influences emotional and mental wellbeing.

This distinction is crucial when designing educational interventions for young people. We cannot limit our efforts to just teaching knowledge—we must also consider if they have opportunities to practise what they’ve learnt. Can they regulate their spending behaviour under pressure or temptation? Do they have a healthy attitude towards money?

It is common to condemn young people as “knowing but not acting.” That is, they  understand the importance of saving, yet still overspend. This highlights that if we ignore behaviour, attitudes and emotional factors, we cannot truly nurture a financially healthy generation.

Why is financial wellness a critical part of overall wellness? 

Financial wellness is a key pillar of overall wellbeing. This is particularly important for adolescents, who are in a golden phase of developing values, self-identity and behavioural patterns. Financial pressures, choices and temptations have already infiltrated their daily lives through the internet and digital technologies. The challenges they face include high living costs and academic pressures, a consumer culture shaped by social media, as well as early exposure to e-payments, in-game purchases, and even investment platforms.

Today, digital and technological challenges, instant gratification, and social media trends dominate. With platforms designed intentionally around reward mechanisms—likes, comments, views, game upgrades, virtual gifts, achievement badges—there are so many  triggers to instant pleasure in the brain. In such an environment, lacking both media and financial literacy can cause young people to view money as a tool for gaining social acceptance, further amplifying emotional fluctuations and spending pressures.

Moreover, platforms are increasingly merging entertainment with consumption. Companies  sell products and offer a sense of identity, privilege and visibility. This often leads young people to unknowingly spend money in virtual settings to gain recognition, leading to a sense of inclusion they feel may be missing in real life.

Therefore, financial wellness is deeply intertwined with mental health, life skills, and social engagement. By supporting young people in developing financial wellness, they can navigate a complex and ever-changing world by improving media literacy, forming sustainable financial habits and adopting a healthy perspective on money to see money as a tool, not a measure of worth.

What is the connection between financial stress and mental health, and how do they impact each other?

The connection between financial stress and mental health is inseparable. For young people, this stress often doesn’t stem from “not having money,” but from their perception and relationship with money.

We often see young people feeling excluded or anxious because they cannot afford trendy items or participate in peer conversations. Some may feel regret after making in-game purchases, but due to the “sunk cost effect” (having already spent and reluctant to stop), they end up spending even more.

More concerning is that many platforms (especially games) make offer random rewards and scarcity incentives. With the sunk cost effect, all of this resembles a gambling psychology. These mechanisms are particularly impactful on adolescents who have yet to form stable values. Social media further exacerbates pressure by becoming a stage for consumption and comparison and reinforcing a FOMO (fear of missing out), heightening anxiety about being left behind.

Biologically and psychologically, adolescents are still developing. Their prefrontal cortex—responsible for self-control, risk assessment, and future planning—is not yet fully mature. Without adequate support systems and educational interventions, they can easily lose their way in a hyper consumer environment, with negative consequences for both their mental and physical wellbeing.

How does Wellness PLUS support young people’s financial wellness?

Wellness PLUS (Kowloon) strongly believes that financial education must keep pace with the times, to prevent students struggling to develop sound financial values and become more prone to financial difficulties. Youth work must take the lead in enhancing financial education and designing suitable programmes to equip young people with the future skills needed in an era of digital consumption.

We pioneered an Integrated Financial and Digital Literacy Framework, aiming to combine financial education with digital literacy to comprehensively address challenges students face in managing money. This framework covers not only traditional financial knowledge but also integrates digital technologies, addressing key topics through tailored curricula to understand potential pitfalls and make wise financial decisions in an age of information overload.

We also have initiatives including FiNet (Jockey Club), Play It Smart and the Dream-coming-true Workshop in collaboration with Lung Hang Youth S.P.O.T.S., each targeting different student groups to build financial literacy and wellbeing. ■