20 Signs You’re Financially Stable (and 20 Signs You’re Not!)

J. Money had a fun post the other day where he went over 20 signs that you’re financially stable and 20 sings you’re not. I thought it was a fabulous idea so I decided to play. 🙂

Let’s start with the positive signs:

  1. You’re at peace with your money situation. Yup.
  2. You don’t fight about money with your spouse. Mrs. T and I talk and discuss about money all the time.
  3. You don’t use your credit cards often, or if you do, you pay them in full every month. We try to put all of our purchases on our credit cards to maximize our rewards points. As my dad had taught me, we pay off the balances in full at end of each month. I never bother looking at the statements, just pay whatever the current balance is on each card.
  4. You’ve got a fully stocked emergency fund. We don’t have your prototypical emergency fund. We do have an opportunity fund though.
  5. A job loss wouldn’t mean you couldn’t pay your bills. We have enough cash buffer to pay for expenses. We can also dip into our monthly dividend income or sell some investments in worst case scenario.
  6. Financial emergencies don’t invoke panic. Ditto.
  7. You’re okay with spending money on special occasions. That’s what the Play Account in our budget is for, so we can spend money guilt free.
  8. The thought of being generous sounds exciting and not panic-inducing. Totally! We donate to local charity each month. One of my goals is to be able to write a $1 million cheque and donate to a charity. 🙂
  9. You’re happy about your financial situation. YES! Isn’t this similar as #1?
  10. Saving money has become a habit. I have been told a few times by my family that I’m an extreme saver. I think that’s a GOOD thing right?
  11. Others’ opinions about what you have/don’t have don’t concern you. What did you say? Whatever I don’t care anyway.
  12. Paying the bills doesn’t require an in-depth plan. For yearly big bills like properties taxes, house and car insurance, we put money aside every month. So no need for in-depth plans.
  13. Retirement and/or kids’ college expenses are covered. We plan to utilize dividend income to cover retirement expenses. We’re slowly getting there. College for kids? We have opened an RESP account for Baby T1.0 but still need to do that for Baby T2.0. We also created a dividend portfolio for Baby T1.0, again need to do that for Baby T2.0 still. But since one can attend post-secondary education for free and get paid by the government in Denmark, we may look into that option (i.e. move and live in Denmark).
  14. Your debt-to-income ratio is below 30%. YES!!!
  15. You’re thoughtful about purchases. Yes, in fact, I tend to over analyze purchases.
  16. Avoiding/eliminating debt is a priority for you. Not really a top priority for us as we don’t have any consumer debt.
  17. You budget or you’re so good at spending wisely that you don’t need to budget. We definite budget, have been doing that for almost 5 years now. Works great. So glad we had our financial epiphany. 
  18. You have a plan for the unexpected. I think we plan for the unexpected…but sometimes you can’t plan for everything in life. You just need to face the challenges and have a creative mind to solve these challenges. 🙂
  19. You buy appreciating as opposed to depreciating assets. I have no problem spending a few grands buying dividend paying stocks, but I am usually hesitant when it comes to buying things that will depreciate in value quickly.
  20. Large purchases don’t create a damaging ding in your finances. That’ what our Long Term Savings for Spending account is for. Living below your means helps as we create buffer each month that can be saved toward large purchases.


How did you do?

18 out of 20! Booya!

Here’s grading system:

  • 16 – 20: You’re kicking it!
  • 11 – 15: You’re doing very well!
  • 6 – 10: You’re off to a good start!
  • 0 – 5: You’ve got room to grow.

Based on the grading system, We’re kicking it!!! That’s 90% so I think we did pretty good. 🙂  If you get a score of below 10 you need some serious help! If you’re in that boat, start by reading more of this blog and other excellent blogs like Mr. Money MustacheBudgets Are Sexy, and Afford Anything.

J. Money also listed 20 signs that you need a financial makeover. Let’s see how we do.

The 20 Signs You Need a Financial Makeover…

100 dollar

  1. You charge group dinners on your card and keep your friends’ cash to spend. Because we have credit cards that give rewards points, I don’t mind charging group dinner on one of our credit cards and take friends’ cash. BUT I don’t spend that cash. Since we have a budget system, that cash simply goes into the PLAY account so the accounting is done correctly.
  2. You spend more than 40% of your total income on rent. Nope.
  3. You’re constantly transferring your balance to get 0% interest on your credit card debt. I have never done any sorts of balance transfer. In fact, I’ve always paid off my credit card balance every single month since I got my first credit card almost 15 years ago.
  4. You pay off one credit card with another. I would be nuts to do that. Nope.
  5. Less than 10% of your income goes to your retirement savings.  (Or worse, zero percent!) I suppose anything more than 0% is better but 10% is really not good enough for retirement savings anymore. We save a lot more than that. 🙂
  6. You have a credit card that doesn’t give you anything in return, like cash back or airline miles. We have 4 credit cards and all four provide either cash back, travel rewards points, or airline miles. One of the cards I recently applied for the sake of getting some bonus Aeroplan miles. The plan is to cancel this card once I get all the promotional miles. One of the cards is the Marriott Visa which I use for work. Since I typically stay at Marriott properties when travel for work, I can rack up Marriott rewards points pretty quickly this way. The card also guarantees silver status, which gives some benefits. Our primary card is the Capital One Travel Aspire Master Card. It has a $120 annual fee but we get $100 worth of travel points each year (grandfathered rule). So $20 worth of annual fee while getting 2% rewards for each transition is a pretty good deal.
  7. You don’t know what IRA means outside of Ireland. I know a little bit about what IRA means but since I’m a Canadian, TFSA would be the term to really know.
  8. You pay the minimum balance on your credit card each month. I am not crazy and stupid enough to pay the 19.99%+ interest rate.
  9. You don’t open your credit card statement because you can’t bear to see how high the balance is. Never but I can feel the pain for someone in this position.
  10. You don’t keep receipts because they remind you of what you’ve spent. Mrs. T and I keep all of our receipts and enter them in the budget excel sheet.
  11. You know your company has a 401k plan, but you have no idea what that is. Again the Canadian equivalent is the RRSP. My company matches our contributions, up to 3% of our annual salary. Since that’s essentially free money (actually it is FREE MONEY), I took advantage of this great deal as soon as I was eligible many many moons ago.
  12. You withdraw cash frequently from ATM’s that aren’t affiliated with your bank. We rarely carry cash but when we needed to withdraw cash, we remember to withdraw from the credit union’s ATM, or from an affiliate bank that doesn’t charge any withdraw fees. We did have to withdraw cash a couple of times in Japan when we went on our 2 week vacation last year. I was not happy to get charged, especially when one of the places charged a $5 transaction fee.
  13. The number of credit cards in your wallet is higher than the number of dates you’ve had this year. We have 4 credit cards but really only use 1 of them most of the time.
  14. You buy so much on eBay that they’ve awarded you VIP status. I don’t even remember what my eBay login ID is… or if I even have one.
  15. You want to start a savings account, but then sale season starts again! ROFL, that’s the most ridiculous excuse for not saving money.
  16. You don’t have an emergency fund to pay bills should you lose your job. Like mentioned above, we have an opportunity fund and have buffer in our budget system to pay for bills.
  17. Your monthly extra cell phone minute charges are bigger than your monthly electric bill. T is on a $25 per month unlimited minutes plan and my work pays for cellphone plan. I’m always surprised how much my work cellphone plan is. A few times my monthly bill came out to be over $200 ( I must have done a lot of long distance calls and roaming calls while traveling). When I used to pay for my own cellphone, I was on a similar $25 per month plan as Mrs. T and never went over my monthly minutes.
  18. You overdraw on your checking account more than once a year. Never done that before.
  19. You live paycheck to paycheck. Not in the general sense but it would be nice if we can live on previous month’s paycheck to break out the cycle.
  20. You spend more on new shoes annually than you save. The shoes I’m wearing now cost $40! When I bought them at the store they were labeled $90. When I went to pay, the sales lady said “wow these are great deal.” I was a bit confused until I saw the number on the cash register. Mrs. T and I looked at each other, became very quiet, paid for the shoes, and left the store as quickly as we could before they realized it was a mistake.


I guess we are maybe 0.5 on #16 and 0.5 on #17. So that adds up to 1 point. Pretty good I think. Hopefully you are doing better on the positive signs than the negative signs.

Dear readers, how did you do? Please share with your scores. 🙂

PS Don’t you like my mad drawing skills? 🙂

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  • Reply
    Fervent Finance
    June 2, 2016 at 8:25 am

    On the “Need a Financial Makeover” side I don’t keep receipts and I do withdraw money from non-affiliated ATMs. I don’t keep receipts because everything gets charged to a credit card which gets accounted for in Personal Capital, and my bank reimburses ATM fees. So I don’t think I need a makeover 🙂

    • Reply
      June 2, 2016 at 10:58 am

      Good call. Personal Capital works great that way. 🙂

    • Reply
      June 6, 2016 at 10:59 am

      I keep my CC receipts and check them against the CC statement, I have caught over charges at restaurants several times including a double charge. To err is human but I do not feel like paying for it


      • Reply
        June 6, 2016 at 3:44 pm

        I’ve done that myself too, always check against the CC statement.

  • Reply
    June 2, 2016 at 12:35 pm

    Good overall scores…! I guess you kinda expected that.
    I will do the test and post bout it. I expect to have good scores as well

    • Reply
      June 3, 2016 at 1:21 pm

      I think most PF bloggers would have pretty solid scores.

  • Reply
    J. Money
    June 2, 2016 at 1:47 pm

    Always fun to see this stuff spread around 🙂 Dope doodles too!

    • Reply
      June 3, 2016 at 1:21 pm

      Haha doodles are fun.

  • Reply
    Cash Flow Diaries
    June 2, 2016 at 2:59 pm

    Oh man looks like I got 19 out of the 20. But the one I missed is for a kids college fund. I dont have kids (yet) so I dont know if that should count. :p

    • Reply
      June 3, 2016 at 1:22 pm

      Very solid score. 😀

  • Reply
    Financial Slacker
    June 2, 2016 at 4:31 pm

    Great lists.

    I can’t imagine spending more than 40% of my income on rent. Apart from the financial impact, that would leave so little left over for fun stuff.

    Thanks for this.

    • Reply
      June 3, 2016 at 1:22 pm

      40% is pretty high indeed.

    • Reply
      June 7, 2016 at 7:20 am

      It’s actually pretty common in a city with a shortage of rentals. I had to do that in one city due to less than 1% vacancy rate (gotta love university town) and I couldn’t afford to buy a house there. The plus side is that rent included utilities, a huge boon since the heat was powered by electricity. Eventually, I made enough money that the rent only ended up being 30%.

  • Reply
    June 2, 2016 at 7:36 pm

    Hey nice list Tawcan. We’re 19/19 on the first list (we don’t have a kid yet, saving for IVF first lol).

    We don’t have a credit card at all, so a lot of the 2nd list is nullified for us. Our rent is currently 34%, but that’s because we live in an Australia (expensive), we only have 1 income at the moment, and I’m at the start of my career. Hopefully in a couple of weeks that % will be a lot better.


    • Reply
      June 3, 2016 at 1:23 pm

      Australia is indeed pretty expensive. Hopefully with potentially more income you will spend less % on rent. 🙂

  • Reply
    The Personal Economist
    June 2, 2016 at 8:10 pm

    Great list, 19/20 for the positives.
    Similar to Dividends Downunder some on relevant but even I know what an IRA is and I’m Australia. By bank rebates all ATM fees at any ATM?

    • Reply
      June 3, 2016 at 1:23 pm

      Very cool that your bank rebates all ATM fees.

  • Reply
    Team CF
    June 2, 2016 at 11:15 pm

    Hey Tawcan,
    We are on par with 18 out of 20. The debt to income ratio of no more than 30% is currently true, but this will change in a couple of months once we have bought the new place. Technically we would have a debt that is higher if we don’t include any rental income from said property (it’s a triplex, one for us, two to rent out).

    • Reply
      June 3, 2016 at 1:23 pm

      Very solid score Team CF! That’s exciting with a new place.

  • Reply
    June 3, 2016 at 1:38 am

    This is a fun test and I am doing pretty on both, only the retirement expenses aren’t yet covered entirely (just a few more years!).
    Another one that would require a financial makeover is : “do you use payday loans?”. This is even worse than credit card debt!

    • Reply
      June 3, 2016 at 1:24 pm

      That’s awesome that you’re doing great on both. Boy don’t even get me started on payday loans.

  • Reply
    Dividend Gremlin
    June 3, 2016 at 6:44 am


    I really liked you shoes reference there at the end, I feel like I’ve had a similar experience before and I do the exact same thing. Thanks for doing that quiz, I scored fairly high too across the board. The only long term item that I know, which will never subside is my wife liking shoes. But on the positive side she never goes overboard and limits herself!

    – Gremlin

    • Reply
      June 3, 2016 at 1:25 pm

      It was a funny story because these shoes have lasted me for almost 2 years now. Pretty good price for a pair of shoes.

  • Reply
    June 3, 2016 at 9:43 pm

    Uh Oh. I’m in financial distress. I have 2 credit cards and no dates this year 🙁 !!!

    • Reply
      June 6, 2016 at 10:20 am

      Oh uh, better find yourself some dates. 😉

  • Reply
    Stefan - The Millennial Budget
    June 4, 2016 at 8:38 pm

    Love seeing post like this. Always fun to see how other bloggers do but I am more curious how the average reader fares!

    • Reply
      June 6, 2016 at 10:20 am

      I’m curious too.

  • Reply
    June 6, 2016 at 7:12 am

    please clarify the debt to income ratio LOL 🙂 is it base on gross income or net income? It’s a fun test.

    • Reply
      June 6, 2016 at 10:21 am

      Typically people just use gross income but you can use net income too.

    • Reply
      June 7, 2016 at 7:22 am

      I’d say net income is best because it’s really the take-home pay that matters the most. Since I’ve started doing this, I found that I was able to have more free cash because I was able to spend so much money based on take-home pay especially when you lose about 30% of your pay almost immediately. That’s a significant impact.

      • Reply
        June 7, 2016 at 10:10 am

        I think net income makes sense too as you’re using the post-tax money to pay for rent.

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