31 Signs You’re Financially Stable

Being financially stable gives you freedom to live the kind of life you want. Here are 31 signs of financial stability that you should start pursuing today.

I remember the day like it was yesterday. My wife and I were in Target, trying to decide between dental floss and aluminum foil. Being just newly married and still paying off my debt, we had little breathing room. We were not the picture of financial stability. Being financially stable means one thing – having peace of mind and there in the grocery store, we did not have that.

Fast forward 15 years and a lot of things have changed with our finances. We max out our retirement accounts every year, we pay off our credit cards in full each month and spending just to spend holds little value to us.

Taken individually these signs may not mean you’re financially stable, rather, it’s the whole that determines financial stability. Each situation is different and we all have different journeys. Take a look at these signs and use them as a starting point to gauge how financially stable you are.

You Can Handle an Emergency


Emergencies happen all the time. How big of an emergency can you handle? A majority of individuals can’t handle a $400 emergency. Many say you need to have a 6-12 month emergency fund. It may feel overwhelming to get to that amount. Don’t let that stop you! Start with $500 and build from there. Being financially stable means you let emergencies roll off your back, financially speaking.

You Have No Problem Splurging on Yourself


What does splurging have to do with financial stability? A lot in fact. It means that your budget can withstand that special purchase without a negative impact. If you put it on your credit card, without knowing when you’ll be able to pay for it, well, that’s a different thing altogether.

You Invest Every Month


This is a financial mistake I made for far too long. I thought I needed to have a lot of money to start investing, so I held back. Being financially stable means you invest regularly. Whether that be in your 401(k) plan or in an online brokerage account or some other form, you’re actively growing your wealth every month. If managing your investments seems challenging, using a robo-advisor like Betterment or Wealthfront can help you invest money every month.

You Have A Low DTI


DTI, or Debt-to-Income Ratio measures your monthly debt obligations against what you make. Thus, lower is better. You can get a mortgage with a DTI as high as 43 percent though that would be foolish on several levels. However, if your DTI is half of that, then you’re much closer to being financially stable as you will have more money to work with each month.

You Use Credit Cards Wisely


Credit cards can be divisive. I love them – we have close to 40 between my wife and I. The catch? We pay them off, in full, every month.

Having that many credit cards enables us to take advantage of travel rewards. Those who aren’t financially stable use credit cards to buy things they don’t have money for to finance the kind of life they want but can’t afford.

If you use a credit card for convenience, to stretch your budget or to take advantage of rewards then you’re likely financially stable.

You Pay off Your Credit Cards Each Month


See the above. If you pay off your credit cards in full every month then you’re financially stable. As one who used to not do this, I can tell you from personal experience that the stress is not worth it.

You Don’t Fight with Your Partner


Finances are one of the biggest reasons for divorce in America. Whether that be due to financial infidelity, or some other reason it can wreak serious havoc on a marriage. Financial stability, on the other hand, means you and your spouse are on the same page financially and are working towards common goals.

You Can Sleep at Night


I believe this is the most important part of being financially stable. Before we reached a moderate level of financial stability I couldn’t sleep at night. I was worried about how we would handle an emergency. I was fearful about our retirement. Now, there’s a peace of mind where there used to be unease. Peace of mind is a huge indicator of being financially stable.

You’re not Underwater on Your Car


According to, more than 60 percent of car loans are over five years in length. A financially stable person sees cars as a depreciating asset and thus believes it is senseless to owe more than a car is worth.

This doesn’t necessarily mean you don’t have a car payment (though I don’t plan on ever having one again), but it means you don’t extend the car loan for so long that you owe more than it’s worth.

You’re Not Scared of the Future


A financially stable person smiles at the future. They’re excited for the opportunities and what they may bring about. Financial instability, on the other hand, stokes fear about what retirement may look like or if you’ll be free of debt. If you’re concerned about your financial future, check out Simple. It’s free to use and allows you to set financial goals to work towards and tells you how much you can spend each month.

Killing Debt is Your Top Goal


Attacking debt is the top goal of those seeking financial stability. Debt enslaves you to someone/something else and restricts freedom. A financially stable person has a plan to kill debt or is already debt free.

You Live Below Your Means


Many financially sound people do one thing really well – they live on less than they make. This is by no means scientific, but I’d say saving at least half of your income is a good goal to build from. It can even be done on a variable income, so it’s possible in many situations.

You Track Your Spending in Some Fashion


Budgets don’t work for everyone. That doesn’t mean you don’t track your spending. Being financially sound means you know where your money is going and how it is working for you. If tracking your spending is overwhelming, try a free tool like Personal Capital to get started.

You Can Handle Large Purchases


Large purchases are somewhat relative; they can be anything from buying a ‘new to you car’ or replacing the air conditioner in your house. Regardless of what it is, you’re able to make large purchases (because you’ve planned for them) with no sweat.

You’re Financially Naked with Your Partner


Remember the thing about not fighting above? Being financially naked with your partner is a big key to that. A financially stable person bares all things financial with their partner – not just the good parts either.

A Job Loss Isn’t the End of the World


Losing a job can be traumatic; don’t get me wrong. Financial stability allows you to roll with the punches of a job loss thanks to an ample emergency fund and other savings. This allows you to take the best job for you and not just jump blindly at the next job.

You Make Extra Money on the Side


I hesitated to add this to the list, but I think it fits. Making extra money can mean many different things. It may mean you actively take on new roles in your day job. It may also mean starting a side hustle to make a few extra bucks in your free time. Bonus points for using the money to kill debt or invest.

You’re not Underwater on Your House


Remember the car above? Likewise, a financially stable person isn’t going to be underwater on a home. That’s a sign of buying too much house or not planning. Houses aren’t investments in many cases but you want to build equity right away if at all possible.

You Take Care of Your Health


I hesitated to list this one as well, but believe it fits. A financially stable person sees the impact health has on their finances – both short and long-term. This is much of why I lost 100 pounds last year on Nutrisystem as health and finances can be very intertwined.

Your Net Worth Goes Up Each Year


This is really the culmination of everything. A financially stable person seeks to grow their net worth year over year. While some of it is out of your control when you invest in the stock market, many other things are in your control. You’re avoiding debt, you’re saving more and building streams of passive income to create an upward trajectory for your financial picture.

You Control Your Finances – not the Other Way Around


What do your finances look like? Are you in control of them, or do they control you? Financial stability means you have the control so you get to decide where your money goes, not the other way around.

You Can Buy What You Want


Financial stability provides the freedom to buy what you want. You’ve set aside the money and can do so with freedom from fear of how you’re going to afford it. If this describes you, then you’ve reached financial stability.

Spending Money Just to Spend Doesn’t Appeal to You


On the flip side of the above, you know you can afford what you want but you see many other ways to put your money to better use. In short, spending simply doesn’t appeal to you – even if you can afford it.

You Automate Savings


Automating my saving was one of the first times I felt confident with my money. Before I was worried I’d need the money for a debt payment. Now, I see it as a bill to my future self that worked even while I slept. If you can automate your savings then you’ve reached a level of financial stability.

You Have Plans


This is purposely broad. A financially stable person plans for the future. They save for retirement, they buy life insurance and they save for their children’s college education. The level of each is personal, but financial stability means you plan for them all, and others, so you can act with confidence.

You Get Rid of Bad Habits


It’s crazy how much we spend on our bad habits. We’re all prone to them, but a financially stable person actively seeks to cut those bad habits to save money every month and grow the money instead of flushing it down the toilet.

Your Credit Score Doesn’t Scare You


Credit scores aren’t perfect by any means, but I remember where my credit score was when paying off debt. It was scary. A financially stable person has a good credit score so when they do need to borrow they get the best rates possible.

Paying Bills Doesn’t Scare You


Does the thought of paying your bills every month make you break out into a cold sweat? Do you need to come up with an in-depth plan? A financially stable person pays their bills each month with little fanfare as there are no surprises and you still have money left in your bank account when it’s over.

You Can Give Without Fear


I also hesitated to include this on the list though I believe a financially stable person can and does give out of what they have and makes a plan to do so. You’re able to give with ease and not in fear of what it might do to your finances.

You Don’t Bounce Checks


I think this is one of the very few things I didn’t do when I was mired in debt. That being said, a financially stable person doesn’t bounce checks. Now, I know mistakes can happen but you get the point – you’re not actively bouncing checks. A financially confident person knows what they have in their bank account and doesn’t watch their checks bounce like a rubber ball.

Missing A Paycheck Doesn’t Scare You


Running our own business has caused me to be more comfortable with this, but a financially stable person isn’t afraid when they miss a paycheck. They have funds in place to cover for emergencies and can deal with a temporary blip like this. Bonus points for replenishing your savings account when you do get paid.

Being financially stable gives you freedom to live the kind of life you want. Here are 31 signs of financial stability that you should start pursuing today.

The Purpose of Being Financially Stable


I think it’s important to remember that none of us are perfect. We all make mistakes and have hurdles to overcome. It’s also important to remember that financial stability is an ongoing journey, not simply a destination.

The goal of that journey is to grow in knowledge and your financial well-being. Both serve to living a life of freedom, not one of enslavement to others. That freedom allows you to make choices that benefit you in the long-run to live the kind of life you want.


What are some other signs of financial stability, in your opinion? What was the first thing that started the journey for you? How do you stack up against these signs?

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I'm the founder of Frugal Rules, a Dad, husband and veteran of the financial services industry. I'm passionate about helping people learn from my mistakes so that they can enjoy the freedom that comes from living frugally. I'm also a freelance writer, and regularly contribute to GoBankingRates, Investopedia, Lending Tree and more. If you're wanting to learn how to monetize your blog, check out my blog coaching services to see how I can help you take your site to the next level.


  • Great list, John! I think we stack up very well, according to your list.

    Being transparent, communicating and agreeing on financial goals with your partner is a huge part of becoming financially stable, in my opinion. I don’t think we would have been able to be in a good financial position without being on the same page.

  • Jason Butler says:

    I’m almost there. I still struggle with a couple of the items on the list. I’m getting much better. though. Learning how money works and being accountable has helped me a lot.

  • Great list. I like that you said individually none of these mean much, but the more you have checked off the closer you are to being stable (I prefer the word “well-off” personally).

  • Syed says:

    Excellent list John. It seems like many of these points assume you have a good amount of money in savings. Automating my savings has been the main way I have been able to keep my savings rate high. 401k deductions from my paycheck, and automatic deductions from my checking into an online savings account and IRA have been the backbone of my finances.

    We have about the same number of cards as you as well. Love getting rewards. My 3 year old also loves playing with them!

    • John Schmoll says:

      Thanks Syed. I think you’d be right on that idea. Agreed on the automating. It has been a lifesaver for us as we don’t forget to do it and it does all the work for us.

      Ha ha, I bet our kids would love playing with our cards as well – I’d be concerned they’d lose them though.

  • Belle says:

    Great post! My husband and I just separated a month ago and I’m starting over. It feels like becoming financial stable again will be challenging and will take some time. I’ve seen my net worth decrease substantially, but this list has really encouraged me to set some goals and work toward building it back up. Thanks!

  • Miss Thrifty says:

    Great list! 22/31 isn’t too bad, right? I’m working on those ones I couldn’t answer with a confident “Yes.”

  • More than 20, quite please with that actually! I think the most important one on the list is the sleeping at night. I think that if I can go through my life not losing any sleep over my finances, I’ll chalk that one up as a win!

  • Samantha Allen says:

    Great list! I’ve got them all down, I think. Working on doing better about making extra money in a side hustle. Also, we don’t use debt/credit cards in our financial plan, so those don’t apply to me.

    I will say I don’t agree with your statement: “A financially stable person has a good credit score so when they do need to borrow they get the best rates possible.” I would argue that a financially stable person (such as myself) doesn’t need to borrow money because they have savings. So therefore they never have to worry about their credit score. I know some people disagree with me especially on mortgages, but this has worked for 10+ years. And you can get a reasonable mortgage without a credit score, I’ve seen it done.

    • John Schmoll says:

      Very cool Samantha and thanks for stopping by!

      That’s a fair point and can understand it. Like I pointed at in the beginning, each situation is going to be different and we need to allow for some of that. For many being able to buy a house in cash might not be feasible, but they’re able to put down at least 20% to avoid PMI and being underwater. I’d classify them, assuming they’re hitting many of the other targets, as being financially stable.

      There are also other benefits to higher credit scores like potential savings on things like car insurance, not to mention being offered a job vs. not (well, that’s more so related to them simply checking your credit.)

  • Kurt says:

    This is an excellent checklist John, thanks! The one of these I have trouble with is splurging on myself. I just don’t do it, unless you count a $1.80 brewed decaf out once a week or so. Maybe it’s time to loosen up and not be so tight. 🙂

    Sorry I haven’t stopped by for a while–happy to see you’re still doing excellent work.

    • John Schmoll says:

      Hey Kurt, good to “see” you. 🙂 I’m the exact same way, for the most part. I think it’s something I ingrained in myself as I was paying off debt – that I shouldn’t splurge on myself. I’m not on that extreme end anymore, but it still is a challenge. But, as I know you are, I’d rather be on the not splurging too often end. 🙂

  • Hey John,
    Funny you should write this post as the wife and I were discussing this just the other day. We were talking about being debt free now for over 2 years and how it’s affected our life. I’ll likely blog about it however all the points you made are valid above. It’s the best feeling in the world knowing you don’t owe anything to anyone and worth being frugal for. Great post mate.

  • ZJ Thorne says:

    For me, stability means that I have the room to be generous in my time with people I love. That I have the money to support organizations doing valuable work.

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