Mastering your personal finances can be a daunting task, especially if you’re doing it on your own. With so many ways to measure financial wellness, from credit scores and reports to the number in your savings account, there has to be a better way to consolidate this information and determine how your overall financial health is doing.
That’s why we’ve teamed up with AccountScore to provide our customers with a suite of personal finance tools and scores, including the Financial Health Score. This personalised score is calculated just for you using our Financial Health Indicator (FHI for short). This online tool analyses your financial habits and then uses that information to rate your overall financial health, which is displayed on a scale of 100-900. This is your personalised Financial Health Score, and it helps you to gain a better overall understanding of your financial health at a glance!
How does it work?
Your Financial Health Score is similar to a Credit Score, but it’s calculated differently. Credit Scores don’t take your account activity (like your spending and saving habits) into account. Your Financial Health Score does.
How you manage your money is a big factor to take into consideration when you’re discussing someone’s financial health. That’s one of the criteria that the FHI uses in its calculation. Though the use of open banking, the FHI can get a picture of your spending and saving habits by analysing your monthly payments, and credit card expenditures, and more. Using that information, the FHI not only can show you your Financial Health Score, but also personalised steps you can take today to raise it!
So how can this be useful?
The FHI rates a person’s overall financial health, and the subsequent likelihood that they will be able to make credit payments based on their bank account activity. This is important because many financial institutions offering loans or credit take these very same factors into account when deciding whether or not to enter into credit agreements with an individual. That’s why we calculate the Financial Health Score using the same data that lenders do. Which ensures that our customers see a snapshot of how lenders may perceive their financial health before they start applying for credit. That way, our customers know that they have a better chance of securing credit when they start the application process!
Whether you’re trying to see how lenders and other financial institutions may perceive your overall financial health, or just trying to improve your financial habits, Finwell is here for you.