21 November 2019
Financial stability is a goal most adults work towards and wish to have. Although achieving it can seem intimidating, it is a reliable indicator of one’s ability to live an effortless life in today’s world. The need to feel financially stable and secure comes with adulting, and is a commonly seen outlook in young adults of this generation. So, what are some signs that tell you about your financial security? Let’s take a look.
There can always be certain surprises that can come your way like a Job loss or a medical emergency, and having an emergency fund set up just in case for instances like this can make you feel secure and take away the stress that comes with it. An emergency fund is usually worth six months of living expenses or half a year’s worth of your salary. If you already have a financial source for situations like this, then it is a sign that you’re more financially sound than you think.
2.Your net worth increases every year
If you can save even a buck a month, it is far better than saving nothing. Creating/having some kind of account where you only put in some of your monthly earnings is a great way to save for the future and ensure that you develop a habit of saving which can only get better over time. This way, monthly savings can contribute to an overall increase of one’s net worth. If you are actively saving a certain amount every month, it can mean that you are well above the line of financial security.
3. You don’t spend on unnecessary areas
Can you afford to splurge on yourself or buy whatever is on your mind, and yet don’t do it simply because you know it is unnecessary? This is another big sign of financial security as it shows you can manage your expenses and not spend more than you earn.
4. You use credit cards wisely
Using credit cards wisely can positively impact your credit score. By using these cards for small expenses and maintaining timely repayments will increase your credit score. This is, of course, distinct from some who end up falling into the debt trap using their credit cards.
5. You aren’t stressed about the future
Knowing that you have enough money and sources of income to support your lifestyle in the future is also a sign. Being confident that you can acquire sources of income in the future without any effort is also evidence of being financially sound.
6. You are debt-free
Debts weigh you down financially and can pose a burden for everyday life making it hard to manage your finances and maintain savings. More than 65% of adults are trying to pay off their debt as they lead you down a frustrating spiral.
7.You take advantages of monetary benefits
If you are financially secure, you know where to look for ways to save money whenever purchasing any kind of commodity or making an online transaction as you’d be well acquainted with using them. Taking an active advantage of deals on insurance, healthcare benefits, work incentives and other benefits like coupons also help you ensure your financial stability as money isn’t being spent where it could be saved.
8.You have automated transactions set up
Automation greatly helps save time and effort that requires when making online transactions. The fact that you can confidently set up automated transactions like subscriptions and account management while being confident that you can manage them, is an indicator that you are financially sound.
9. You have no problem splurging on yourself
Lastly, when it comes to buying essentials, you don’t let your finances control you and are generally able to buy all the things that you need.
If these signs resonate with your current financial situation, then you are certainly well-off and are capable of keeping your head above the water for a long time. If you falter on some of these, it’s never a bad time to take up an instant personal loan from EarlySalary to tide over your expenses and be back on the road to financial stability!