33 Signs You’re Financially Stable

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Are you financially stable? Here are 33 signs of financial stability that you should start pursuing today to be free to live the kind of life you want.

I remember the trip to Target like it was yesterday. My wife and I were trying to decide between dental floss and aluminum foil. As newlyweds who were still paying off my debt, we had no breathing room.

We were not the picture of financial stability. Being financially stable means one thing – having peace of mind.

We did not have peace of mind in Target that day. We were at a dead end and had no idea how to improve our situation.

Fast forward nearly 20 years and a lot has changed for us. We max out our retirement accounts every year, pay off our credit cards in full each month, and spending just to spend holds little value to us.

Signs You Are Financially Stable


There isn’t one single trait that makes you financially secure. It’s the whole picture that determines whether or not you’re financially stable. We all have different journeys, so every situation is unique.

Review the following signs and use them as a starting point to gauge your financial stability.

1. You Can Handle an Emergency


One of the first signs of being financially comfortable is having a well-stocked emergency fund.

Emergencies happen all the time. Unfortunately, most people can’t handle a $400 emergency.

Most experts say you need to have a 6-12 month emergency fund. While it may feel overwhelming to save that amount, don’t get discouraged.

Start with a goal to save $250 and build from there. Maybe you can set aside $50 from each paycheck to reach your goal. Eventually, you will have several months of expenses in your emergency savings.

If you’re trying to figure out how to become financially stable and are not currently saving, pick an online savings account with no fees. CIT Bank is a great option since it pays interest and you can automate transfers.

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2. You Have No Problem Splurging on Yourself


Splurging has a lot to do with financial security. If you can splurge, it means that your budget can withstand a special purchase without hurting your financial health.

Keep in mind that using your credit card without knowing when you’ll pay it off is an entirely different thing.

Try setting aside cash each month for planned large purchases. You can also wait at least 24 hours before making an expensive impulse purchase.

3. You Invest Every Month


Not investing every month was 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.

It is easier than ever to invest small amounts of money. Many brokerages now let you buy fractional shares of stocks and funds with as little as $5 per trade. You don’t pay trade commissions either.

Investing regularly helps grow your net worth and allows you to be financially comfortable in retirement. Whether you invest in a 401(k) plan, an online brokerage account, or some other account, you’re actively growing your wealth every month.

If managing your investments seems challenging, using a robo-advisor like Betterment can help you invest money every month.

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If you’re more of a DIY investor, you can start with next to nothing by choosing an app like Stash Invest. This allows you to start investing with as little as:

  • $0.01 for investments priced up to $1,000 per share
  • $0.05 for investments priced over $1,000 per share

When you open an account with Stash Invest and deposit at least $5 they’ll start you off with $5 so you can invest in stocks or ETFs immediately.

4. You Have A Low DTI


DTI, or Debt-to-Income Ratio, measures your monthly debt obligations against what you make. Therefore, a lower DTI is better. You can get a mortgage with a DTI as high as 43 percent, but that would be a poor choice for several reasons.

If your DTI is half of that, then you’re much closer to being financially sound because you will have more money to work with each month.

Having a low DTI can also help you when applying for jobs. While it may seem weird, some employers want to make sure you can handle money before they give you a lot of responsibility.

5. You Use Credit Cards Wisely


Credit cards can be divisive, but I love them. Between the two of us, my wife and I have close to 40 cards. We pay them off in full every month so we don’t have debt hanging over our heads.

Credit cards can be a terrific tool when you use them wisely. However, those who aren’t financially responsible may use credit cards to finance the kind of life they want but can’t afford. The sky-high credit card interest rates they face as a result can make it difficult to pay off debt.

You’re probably financially stable if you use a credit card for convenience, to stretch your budget, or to earn rewards. Just make sure you don’t overspend thanks to the convenience of not having to pay off the balance immediately.

6. You Pay off Your Credit Cards Each Month


See the above. Paying off your credit cards in full every month is a good indication you’re financially stable.

I can tell you from experience that the stress of not paying off your cards each month isn’t worth it.

Credit cards have some of the highest interest rates around. A small balance can quickly turn into a large monthly expense if you’re not careful. Thankfully, there are ways to refinance credit card debt or get a lower interest rate.

If you currently have a balance, see if the Tally app can help you pay it off sooner. Tally can send extra payments to your card provider.

7. You Don’t Fight with Your Partner


Finances are one of the biggest reasons for divorce in America. Whether it’s due to financial infidelity or some other reason, money problems can wreak serious havoc on a marriage.

Make sure you and your spouse are on the same page when it comes to finances. You might want to schedule money dates to start working towards shared financial goals.

8. You Can Sleep at Night


Being able to sleep because you don’t have money stress is the best part of being financially stable. Before we reached a moderate level of security, I couldn’t sleep at night.

I was fearful of many things, including:

  • Handling an emergency
  • Saving enough for retirement
  • Paying all of our bills on time

Now, I have peace of mind instead of unease. Peace of mind is an indicator of financial stability.

One quick way to reduce your money stress is by cutting your monthly expenses. Canceling unwanted services and renegotiating bills can require some upfront effort. However, seeing how much extra cash you have each month can help you rest easy.

9. You’re Not Underwater on Your Car


According to, more than 60 percent of car loans are over five years in length. Additionally, the average car payment is over $500 per month. A financially stable person sees cars as a depreciating asset. As a result, it doesn’t make sense to owe more than a car is worth.

Not being underwater on your car means you don’t extend a car loan for so long that you owe more than it’s worth. It doesn’t necessarily mean you’ve paid off your car.

Instead of buying a brand new car, consider purchasing one that’s one or two years old. Even though it might not have the new car smell, the car is likely several thousand dollars cheaper, has low mileage, and is mechanically sound.

If you have the cash, you can also buy a used car without getting a car loan.

10. You’re Not Scared of the Future


A financially stable person smiles when they think about the future. They’re excited about opportunities and what they may bring.

On the other hand, financial instability stokes fear. You might worry about what retirement may look like or if you’ll be free of debt. It’s easy to become paralyzed when you feel afraid.

While no one can predict the future, have confidence as you learn from your mistakes. If necessary, talk with a friend that you trust to help you plan your future.

11. Killing Debt is Your Top Goal


Attacking debt is the top goal of those seeking financial stability. Debt enslaves you to someone else and restricts your freedom. Your monthly expenses are also higher, leading to more stress.

A financially stable person has a plan to eliminate debt or is already debt-free. If you have debt, consolidating it to a lower interest rate and paying it off is the best way to get rid of it.

Compare rates at Fiona by Even Financial to find the lowest rate from among 17 lenders and start eliminating your debt now.

12. You Live Below Your Means


Many economically stable people are great about spending less than they earn. This is by no means scientific, but I’d say saving at least half of your income is a good place to start.

For instance, if you earn $4,000 per month, you might keep your monthly expenses below $2,000. It becomes easier to live below your means as you pay off debt and avoid unnecessary purchases.

This can even be done on a variable income.

13. You Track Your Spending in Some Fashion


Budgets don’t work for everyone. However, that doesn’t mean you shouldn’t track your spending. Being financially independent means you know where your money is going and how it is working for you.

Writing each expense on paper or browsing your monthly bank statements might work for you.

Try a tool like Tiller if tracking your spending is overwhelming. Tiller pulls all of your banking information into a Google Sheet so you can see all your spending in one place.

The app costs $7 per month after a free 30-day trial.

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14. You Can Handle Large Purchases


Large purchases are expensive and can include 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 (most likely because you’ve planned for them) with no sweat.

Consider putting money into a sinking fund for a specific expense. Even if you only have a small income, these special funds can help you afford large purchases.

15. You’re Financially Naked with Your Partner


Remember the section about not fighting with your partner? Being financially naked with your significant other is a big part of that. A responsible person shares all things financial, good and bad, with their partner.

Being honest can hurt at times. However, total transparency can lead to a stronger relationship because you’ll be financially comfortable with each other.

16. A Job Loss Isn’t the End of the World


Losing a job can be traumatic. Being financially stable 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 your time and find the right job for you instead of jumping blindly at the first opportunity that comes along.

17. Invest In Yourself


Whether you’re in between jobs or are happy with your current employer, you should always try to improve your skills. Investing in yourself can increase your income potential at work or allow you to have multiple income streams.

Another option is learning how to complete your own home and car repairs. Your new skill will reduce your unplanned expenses when something breaks.

18. You Make Extra Money on the Side


Making extra money can mean many different things. For instance, it may mean you actively take on new roles in your day job.

It may also mean starting a side hustle to earn a few extra bucks in your free time. If you use the money to kill debt or invest, even better.

Here are a few of the top side gig apps you can use to earn money if you don’t know where to start.

19. You’re Not Underwater on Your House


Remember the section on car payments? Similarly, a financially wise person isn’t going to be underwater on a home. This means your mortgage isn’t more than your house value.

If you are underwater on your home, that’s typically a sign of buying too much house or not planning properly. While houses aren’t investments in many cases, you want to build equity on your home right away.

20. You Take Care of Your Health


A financially stable person sees the impact health has on their finances. Medical bills can quickly erode the hard work you put into becoming financially secure.

This is the main reason why I lost 100 pounds on Nutrisystem. It’s important to acknowledge that health and finances are often intertwined.

Read our Nutrisystem review to see how you can find success on the plan.

Your doctor’s advice about having a sound diet and regular exercise may sound boring. However, these two factors are the best ways to control your health and reduce stress.

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21. Your Net Worth Goes Up Each Year


The ultimate goal of becoming financially independent is being able to grow your net worth year after year.

While some aspects of growing your net worth are out of your control, for example when you invest in the stock market, there are things you can control.

If you’re avoiding debt, saving more, and building streams of passive income, you can create an upward trajectory for your financial future.

22. 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 get to decide where your money goes instead of living paycheck-to-paycheck.

23. You Can Buy What You Want


Financial stability provides the freedom to buy what you want. You are free from the fear of how you’re going to afford your purchase because you’ve saved the money you need.

If this describes you, then you’re economically stable.

24. Spending Money Just to Spend Doesn’t Appeal to You


This is the opposite of the above. In short, spending doesn’t appeal to you (even if you can afford it) because you see ways to put your money to better use.

25. 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 debt payment. Now I see it as a bill to my future self that works even while I sleep.

If you have automated your savings, then you’re doing a great job of figuring out how to be financially stable. Just make sure to pick a bank that pays more than .001 percent on your cash.

26. You Have Plans


A financially wise person plans for the future. This can involve planning for many things, such as:

  • Saving for retirement
  • Buying life insurance – PolicyGenius is a great option to compare rates
  • Saving for their children’s college education

The amount you save towards each of these is personal, but financial stability means you plan for them all. Start by saving for your most important goals. Then, allocate other cash for your secondary goals.

If you want a life insurance policy that adjusts with your needs in life, Everyday Life is an excellent option. Fabric is another great choice if you want affordable life insurance tailored to meet your specific needs.

27. You Get Rid of Bad Habits


It’s crazy how much we spend on our bad habits. We’re all prone to them. However, a financially stable person actively seeks to cut those bad habits to save money every month.

Instead of wasting money, opt to grow your money.

28. Start a Cheap Hobby


Having fun doesn’t have to be expensive. There are many cheap hobbies you can try today. For example, start a neighborhood league instead of buying season tickets.

It’s okay to splurge from time to time. But remember that having fun with friends doesn’t require spending lots of money each weekend.

29. Your Credit Score Doesn’t Scare You


Credit scores aren’t perfect by any means, but I remember what my credit score was when I paying off debt. It was scary.

A credit builder loan from Self Lender can boost a low credit score. Paying your monthly loan payments on time and keeping a low credit utilization ratio can help too.

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*Related: Do you need to buy life insurance? Check out our review of the best companies to get term life insurance without a medical exam for coverage options.*

A financially stable person has a good credit score. When they need to borrow, they get the best rates possible. However, you should pay with cash when possible to avoid paying interest.

30. Paying Bills Doesn’t Scare You


Does the thought of paying your bills every month make you break into a cold sweat?

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When you are financially stable, you can pay your bills each month with little stress because there are no surprises. Also, you should still have money left in your bank account after all your bills are paid.

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31. You Can Give Without Fear


A financially independent person can give without worry. They also make a plan to give.

Perhaps someone helped you become financially stable and you want to return the favor.

When you’re financially comfortable, you can give with ease and not fear what it could do to your finances. You might perform random acts of kindness, for example buying lunch for someone. Or, you can schedule monthly payments to your favorite charity to help others in need.

One of the most exciting times to give is when charities have matching fundraising drives. For every dollar you give, another donor matches your donation.

32. You Don’t Bounce Checks


This is one of the few things I didn’t do when I was in debt. A financially stable person doesn’t bounce checks. Mistakes can happen, but make sure you’re not actively bouncing checks all over town.

A financially confident person knows what they have in their bank account so they don’t watch their checks bounce like rubber balls.

Sometimes, money mistakes happen when you least expect. This is why several banks, including Chime Bank, offer free overdraft protection when you accidentally overdraft.

33. Missing A Paycheck Doesn’t Scare You


Running our own business has helped me be more comfortable with missing a paycheck since clients sometimes pay late.

Financially stable people have funds in place to deal with temporary blips like this. Just make sure you replenish the funds in your savings account when you do get paid.



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

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


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

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John is the founder of Frugal Rules, a dad, husband and veteran of the financial services industry whose writing has been featured in Forbes, CNBC, Yahoo Finance and more.

Passionate about helping people learn from his mistakes, John shares financial tools and tips to help you enjoy the freedom that comes from living frugally. One of his favorite tools is Personal Capital , which he used to plan for retirement and keep track of his finances in less than 15 minutes each month.

Another one of John's passions is helping people save $80 per month by axing their expensive cable subscriptions and replacing them with more affordable ones, like Hulu with Live TV.