7 Signs You’re Financially Healthy
7 Signs You’re Financially Healthy
Even If You Don't Feel Like It — How Many Do You Have?
Lou Carlozo Wed, February 21, 2024
January was Financial Wellness Month, but it's possible many people still began February believing that in some way — perhaps many ways — they must be mishandling their income, investments and spending.
Though we may feel literally poor about our financial standing, taking a courageous closer look may show us a much different reality.
In one of his videos, YouTuber and former financial advisor Humphrey Yang’s identifies seven signs that you’re actually doing well with your money, emotions or beliefs to the contrary.
With over 275,000 views to date, the clip isn’t set up as a pass-fail test or a prelude to a guilt trip. “... if they don’t apply to you, we can talk about how you can quickly achieve financial wellbeing,” he says.
1. You don’t try to signal your wealth
Using big ticket items to flaunt how much you’ve got is “a zero sum game” of winners and losers, he says. “If you’re buying a Lamborghini, you’re probably just trying to show to outsiders that you’re successful enough to buy a $300,000 car.” Yang says instead of borrowing large sums to buy expensive things and elevate your social status, you should be seeking freedom and peace of mind through building wealth, which he says is a "positive sum game" where everybody can win.
2. You have an emergency fund of at least $2,000
You're on the right track if you have a $2,000 rainy day fund you can tap. The truth is that unexpected bills will pop up. Yang cites a Bankrate article saying 57% percent of Americans can’t afford a $1,000 emergency expense. Having at least double that in a high-yield savings account will mean you're ahead of most Americans, and he adds that it’s ideal to shoot for a cushion worth three to six months of expenses.
3. You’re able to meet your spending and savings targets
Yang sees this as evidence that you have defined financial goals and a budget or a way to track your expenses. He says if you’re making $75,000 annually and spending $60,000, then you should be “making a plan for that extra $15K." You should also be reviewing expenses to identify areas to cut back and identifying ways to earn more income.
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https://www.yahoo.com/finance/news/7-signs-financially-healthy-even-113600089.html