An OFB reader recently reached out with us with a question that we want to pose to all of you guys today. Yes, even you typing away at your keyboard with Cheetos fingers. So here’s the question: What does it mean to YOU to be financially stable? As our reader said in her email, “We use that phrase a lot, and I’d be curious to know what it means to other people/you guys.” Such a great question, right? More specifically, we’re talking about financial stability at this point in our lives — the here and now.
Everyone seems to be seeking after financial stability, but each of us has a different definition of what that entails. So what makes you feel stable or secure? What does it take for you to think, “We’re doin’ all right.”
Financial Stability in the OFB Household
Sally feels financially secure as long as we can afford to keep her favorite foods in the house: egg salad, strawberries, and milk.
First, I think a lot of financial security and peace comes from having full-time jobs. But that alone doesn’t define financial stability. Saving money each month also contributes to financial security, knowing that we’re adding to our bank account on a monthly basis. And having an emergency fund in place is like having that back-up pacifier in the diaper bag. If all hell breaks loose when we’re out in public with Sally, I know I can whip that thing out as a last resort. Similarly, if we lose our jobs and our condo burns to the ground, that emergency fund will be a safety net. Lastly, living without debt is the final piece in creating a financially secure environment. Oh, and having a refrigerator stocked with Diet Coke.
For me, financial stability is being able to meet a budget and consistently put money into savings and retirement on a monthly basis. I think financial stability’s a state of mind, instead of a number or a class. And it’s not living in a state of wants. It’s being comfortable with the budget that allows you to live within your means. Financial stability can be achieved with a $50,000 salary. Conversely, someone who makes $200,000 a year but never feels like they have sufficient to cover their expenses ain’t on the financial stability boat.
So that’s what financial stability is to us. And now… yup, it’s your turn! What does financial stability mean to YOU?