Assessing Financial Wellbeing While Earning My MBA

You are starting your MBA program, so why should you assess or measure your financial wellbeing? Furthermore, why should you monitor your financial wellbeing during your MBA program?

In a previous MyeEMBA post, I suggested a set of action steps for helping MBA students address the financial wellbeing issues that will arise because of their decision to earn an MBA. The first step related to assessment of financial wellbeing, the topic of the two questions above. In this post, I want to focus on the first action step of assessing your financial wellbeing. I will address the other action steps in later posts.

Why assess your financial wellbeing?

I am sure there are many reasons why you should assess your financial wellbeing prior to starting your MBA program. However, I think the most important reason is so you can identify what impact the financial implications of starting an MBA program will have on your life and the lives of others. In addition, measuring and monitoring the impact allows you to manage proactively and mitigate the impact as well as demonstrate the effectiveness of your actions. Finally, I think it is a good habit to establish.

How do I assess?

Individual and organizational wide assessment tools are available. For example, one employee assessment program for organizations is Saratoga, a product offering by PricewaterhouseCoopers. Therefore, using employer provided tools might be an option for some MBA students. However, for individuals without employer-based programs, an excellent tool for assessing financial wellbeing is the Wellbeing Finder, a resource that is available on Gallup’s Wellbeing Web Site. To gain access to this tool you purchase the book, Wellbeing: The Five Essential Elements, by Tom Rath and Jim Harter.

Using the Wellbeing Finder, you can answer a series of questions, the analysis of which:

  • Generates a scorecard that includes your financial well-being score
  • Provides tracking of your financial well-being over time so you can compare scores as well as compare your scores to other demographic groups stored in their database
  • Allows you to create action items for taking action to improve your financial well-being
  • Allows you to discover patterns in your life that affect your financial well-being

The Wellbeing Finder is especially helpful for MBA students because it establishes a financial wellbeing baseline for monitoring changes in financial wellbeing while participating in their MBA program. I am currently using the tool and am finding it extremely useful.

Who should be assessed?

The assumption up to this point is that financial wellbeing assessment applies only to the MBA student. However, for MBA students with a spouse or significant other, there are at least two financial wellbeing perspectives to consider, the MBA student and the spouse or significant other. Therefore, assessment should include the MBA student’s spouse or significant other.

Using assessment results:

Assessment results provide insight into the individual’s view of their financial wellbeing. Using the results as a basis for reflection on the financial aspects of one’s life is important. The individual financial wellbeing score, as well as the scores from the other elements, and the overall score may help you understand the issues that add stress to your life, or why you cannot accomplish more during certain parts of the semester. The assessment results only help you if you develop a deep understanding of their meaning.

On the other hand, dual assessment provides the opportunity to compare scores and to discuss differences so there is an opportunity to develop a common and perhaps even deeper understanding of the financial wellbeing issues resulting from starting the MBA program. Discussion and understanding early helps reduce the probability of conflict later. In other words, “an ounce of prevention is worth a pound of cure.”

Assessment frequency

If you use the Wellbeing Finder, then I think assessing at least once per semester is the minimum or more frequent if events occur that directly affect your financial status. The Wellbeing Finder, for all five elements, only takes 15-20 minutes to complete, and the assessment report you receive includes a brief description of financial wellbeing, a graph that displays results over time, suggested action items, and any personally created action items. This report provides you a history of your perception of your financial wellbeing. The adjacent figure provides you an indication of what the report looks like. There is also an interim data collection and reporting tool called the daily tracker. It uses an abbreviated set of questions that takes less time so you can use it more frequently without investing as much time as you do with the Wellbeing Finder. I describe it as a memory jogger tool that provides you a score relating to daily activities that contribute to your financial wellbeing and your overall wellbeing.

My experience is that financial wellbeing issues will arise and, when they do, some MBA students handle them better than others do. For those of you that have completed your MBA did you encounter financial wellbeing issues? For those of you starting your MBA program, what have you done to prepare to address the wellbeing issues? Share your answers as a comment below.

Rodney

Rodney G. Alsup, D.B.A., CPA, CITP
Founder of MyeEMBA.com

[Image by FreeDigitalPhotos.Net member Salvatore Vuono/In accordance with terms of use]

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