Are You Financially Stable?

Do you feel financially stable? I have a lot of friends that tend to worry about paying their bills and it made me ponder about what makes a person feel financially stable. What are some of those important signs that indicate you are on the right track? Today I will discuss 10 signs that may show you are managing your money correctly.

  1. You Never Lose Sleep Over Money

You have enough money in the bank to make you sleep like a baby at night. If an emergency occurs, you know that you have sufficient resources to alleviate the problem. For example, if your car broke down tomorrow and the mechanic told you it would cost $600 dollars, this problem would not impact your lifestyle that much. The key to sleeping well at night is knowing you have enough money to weather a potential financial storm.

2. You Always Have Money In Your Checking Account

If you always have enough money in your bank account you are probably financially stable. For example, if you can go grocery shopping and not have to worry that much about the price, you are doing fine. I personally use to worry about those issues, but that does not seem to be a major concern now. I still budget, but I do not worry if I go over a little.  Also, a person that is having to pay overdraft fees or has less than a $100 dollars in the bank account is probably struggling to get by.

3. You Have Very Little Credit Card Debt

I cannot really discuss this too much because I have never had a credit card. If you have multiple credit cards and your paying one credit card with another you are not financially stable. You should also not be using a credit card everyday to pay for things. Also, if you are using credit cards as a way to extend your paycheck because you are out of money, things are not going well. If I do not have the money to purchase something, I go without. That has worked for me so far.

4. Your Not Too Concerned If you Lose Your Job

I think most of us are concerned about having a job, but if you lose your job tomorrow can you survive for at least 6 months without having a paycheck? If not, you are not financially stable. Basically, if you are living paycheck to paycheck, you will have a difficult time making it if you lost your job.

5. You Always Pay Your Bills On Time

If you pay your bills almost immediately when your bill is available you are doing just fine  monetarily. If you are worried that your electric will be shut off because you are late on paying the bill (this happened all the time when I was growing up) you are not financially stable. One of the main reasons I sleep well at night is I know I can pay all my bills.

6. Everyone Comes To You For Financial Advice

You are the one that everyone comes to for financial advice. They are always asking you questions about investing, saving and planning for retirement. All those years of being frugal has helped you build a reputation  and everyone wants your knowledge. Well, maybe not everyone, but a lot of people ask you financial questions.

7. You Save More For Retirement Than Others

If you are steadily saving money back each month for retirement you are doing well. A person should save at least 10% to 15% of their income each month for retirement.  I typically save around 40% of our net income each month, but I am also trying to retire early. If you really want to retire early, a person has to save a lot more than just the average amount.

8. You Are Great At Saving

If you are great at saving money back you are on your way to financial independence. Saving money back is a way of life and you have been doing this for along time. I have always enjoyed saving and I get more pleasure saving than spending. It seems like I always find a way to save money even when times are difficult. I just find ways to cut.

9. Your Net Worth Continues To Grow Each Year

Each year your net worth continues to grow. The idea is to have more money each year. Last year, I was able to add a little over 39,000 dollars to my overall net worth. I am hoping this year will be even better, but the goal is to always have more money. If it starts going in the opposite direction, “Houston we have a problem.” Growing your money is the key.

10. You Live Beneath Your Means

If you are saving like crazy, you are probably living beneath your means. When others are living paycheck to paycheck you are stock piling your money. I have lived below my means for most of my adult life and I doubt that will ever change. Even if I was rich, I would still live cheap. I have trained myself to think like that. This does not happen over night, but anyone can do it.

If you cannot check all of these boxes, it is not the end of the world. Becoming financially stable takes time and you have to create a system that works for you. Finding ways to cut back each month is the first goal. You might not be at a point in your life that you can do this. It is hard to cut back when you do not have money. The idea is trying to make smart money choices, but not beating yourself up if you make a few mistakes along the way. We are all human and life does happen. Just get up each day and try to make that day a little better than the last.

6 thoughts on “Are You Financially Stable?”

    1. Definitely easier said than done for most people. It seems easy when you read it, but a little more harder when you live it. Nothing happens overnight, but I do feel that people can reach financial stability over time. Thanks for the comment.

  1. We are financially stable. But circumstances change and I don’t take it for granted.

    I remember how unstable we were. We always felt like we were one step away from disaster when we lived in New York. We didn’t even know what an emergency fund was.

    The one thing that’s odd to us relates to your number 6. We know several people who are terrible with money but they won’t come to us for information or conversation. And I don’t believe it’s because they’re embarrassed or ashamed. I believe it’s because they don’t want to change and so they don’t want to look us in the eyes and face their issues.

    1. Growing up my family was poor. It was difficult and my mother had to ask others for money. I hated it and wanted to make sure I never had to do that when I was an adult. I agree that number 6 is a little tricky. I have people at work all the time ask me financial questions, but some of our friends do not. There are a lot of people who just do not want to make the change. It is their life, so I do not push. Thanks for the comment.

  2. I can’t check all of those boxes, but I am working on it. My net worth does go up every year, I think, but that’s because I have been saving for retirement for the past 15 years or so. And I plan on doing more. I’m going to pay off my overdraft and have them cancel it on my account so I need to be extra vigilant about keeping an eye on my checking account balance. As of right now, I check it every day or every other day. I did have a few overdrafts though recently and that has strengthened my resolve to never let that happen ever again just because of poor planning (not moving money from savings quickly enough to cover some expenses.)

    I wish I was more stable. But wishes alone don’t do the job. I need to do the work. I know that and that’s what I am going to do, going forward.

    Great post, Eddie!

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