'Financial' vs. 'economical'

Question

Which of these is the right usage?

• John's financial situation is not good.

• John's economic situation is not good.

When is the usage of financial justified over economic and vice versa, given their similar meanings?

Answer 1

"Economical" is the wrong word to use here.

ec·o·nom·i·cal
/ˌekəˈnämikəl/ Adjective Giving good value or service in relation to the amount of money, time, or effort spent. (of a person or lifestyle) Careful not to waste money or resources.

You could say John's economic situation is not good, but that's a little ambiguous. Financial is a much better choice.

Answer 2

Firstly, it's understandable to get confused on the usage of economic vs. economical (see p.381 of Merriam-Webster's Dictionary of English usage for explanation on the difference).

In current usage, economic situation is normally used in association with a large entity, especially a nation-state. It is rarely (but still occasionally) used with reference to specific individuals. Financial situation, on the other hand, is used in association with large entities, but also potentially with individuals, e.g., John. Financial situation is then the preferred usage.

This assessment is in line with corpus data, some of which I give below. (Caveat obtrectator: corpus results are from a research-grade POS-tagged corpus which is sensitive to morphological boundaries.)

==========

Here are some hits for "economic situation" preceded by the genitive 's in COCA (notice that there are cases where the possessor is a family or an indefinite individual):

1        THESE DRIVERS ' ECONOMIC SITUATION MAY HAVE    1   
2        THEIR FAMILIES ' ECONOMIC SITUATION , MUST 1   
3        THE WORLD 'S ECONOMIC SITUATION FOR A  1   
4        THE TIBETANS ' ECONOMIC SITUATION DIRECTLY ,   1   
5        THE NATION 'S ECONOMIC SITUATION ON SEPT   1   
6        THE NATION 'S ECONOMIC SITUATION . ''  1   
7        THE NATION 'S ECONOMIC SITUATION , NOW 1   
8        THE LUMBEES ' ECONOMIC SITUATION GREW WORSE    1   
9        THE LEAGUE 'S ECONOMIC SITUATION : AT  1   
10       THE FAMILY 'S ECONOMIC SITUATION . ''  1   
11       THE COUNTRY 'S ECONOMIC SITUATION HAS WORSENED 1   
12       THAT TIBET 'S ECONOMIC SITUATION WOULD BE  1   
13       PARTICULAR EMPLOYEE 'S ECONOMIC SITUATION ; THE    1   
14       OF RUSSIA 'S ECONOMIC SITUATION IS A   1   
15       NORTH KOREA 'S ECONOMIC SITUATION DETERIORATES ,   1   
16       IN VIETNAM 'S ECONOMIC SITUATION , THE 1   
17       IN ONE 'S ECONOMIC SITUATION , ''  1   
18       IN AMERICA 'S ECONOMIC SITUATION WAS THE   1   
19       IMPROVED IRAN 'S ECONOMIC SITUATION AND HAVE   1   
20       IMPROVE SYRIA 'S ECONOMIC SITUATION AND BREAK  1   
21       IMPROVE ONE 'S ECONOMIC SITUATION . '' 1   
22       GIVEN PERU 'S ECONOMIC SITUATION , THE 1   
23       GIVEN G.M. 'S ECONOMIC SITUATION , ''  1   
24       BUT BATASHI 'S ECONOMIC SITUATION IS BETTER    1   
25       BALTIC REPUBLIC 'S ECONOMIC SITUATION .    1   
26       ABOUT JAPAN 'S ECONOMIC SITUATION AND HOW  1   
27       ABOUT CHRISTOPHER 'S ECONOMIC SITUATION BEFORE HE  1   
28       A COUNTRY 'S ECONOMIC SITUATION AND LIKELY 1   
29       A COUNTRY 'S ECONOMIC SITUATION .  1   
30       @@25365 TODAY 'S ECONOMIC SITUATION PRESENTS A

As for financial situation, the phrase still is applied to large entities such as corporations, and state and nation, it is however also applied with more frequency to individuals. Unlike the corpus hits for economic situation, we find the proper names referring to specific individuals.

1        DISCUSSED ENRON 'S FINANCIAL SITUATION . ''    2   
2        DENVER-BASED FRONTIER 'S FINANCIAL SITUATION HAS QUICKLY   1   
3        AT ERNIE 'S FINANCIAL SITUATION . AND  1   
4        AND SHANNON 'S FINANCIAL SITUATION MIGHT HAVE  1   
5        AND LOAN 'S FINANCIAL SITUATION WHO ARE    1   
6        ANALYZE INA 'S FINANCIAL SITUATION . MELMAN    1   
7        AC TRANSIT 'S FINANCIAL SITUATION ARE FAR  1   
8        A PERSON 'S FINANCIAL SITUATION . ''   1   
9         VINCENT 'S FINANCIAL SITUATION TELLS ONLY 1   
10       . JULIAN 'S FINANCIAL SITUATION CAUSED HIM 1   
11       . EVERYBODY 'S FINANCIAL SITUATION IS DIFFERENT    1   
12       , GORE 'S FINANCIAL SITUATION IS TIGHT 1   
13       , DAVID 'S FINANCIAL SITUATION . WAS   1   
14       , CARRUTH 'S FINANCIAL SITUATION WAS ANYTHING  1   
15       YOUR FAMILY 'S FINANCIAL SITUATION , YOU   1   
16       YOUR FAMILY 'S FINANCIAL SITUATION , LOCAL 1   
17       YOUR CHILD 'S FINANCIAL SITUATION AS WELL  1   
18       WOODY ALLEN 'S FINANCIAL SITUATION , BUT   1   
19       THIS COUNTRY 'S FINANCIAL SITUATION . LET  1   
20       THEIR PARENT 'S FINANCIAL SITUATION AS THEY    1   
21       THE TRIBE 'S FINANCIAL SITUATION . THE 1   
22       THE TEAM 'S FINANCIAL SITUATION HAS IMPROVED   1   
23       THE STATE 'S FINANCIAL SITUATION DETERIORATED ,    1   
24       THE STATE 'S FINANCIAL SITUATION AND EDUCATIONAL   1   
25       THE STATE 'S FINANCIAL SITUATION , HE  1   
26       THE ROCKIES ' FINANCIAL SITUATION DOES N'T 1   
27       THE ORGANIZATION 'S FINANCIAL SITUATION -- OPERATING   1   
28       THE MAGAZINE 'S FINANCIAL SITUATION . A    1   
29       THE LEAGUE 'S FINANCIAL SITUATION , ESPECIALLY 1   
30       THE INVESTOR 'S FINANCIAL SITUATION AND RISK

Answer 3

You can talk about someone's finances but, you cannot talk about their economy, as economy is the flow of money between many entities, usually at country level.