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| Aww! Poor little piggy… |
A few weeks ago, I saw this quiz on a blog I follow and I thought it would be good for me to try it out. By sharing, hopefully, it will give you a bit of insight as to how I budget every month (since I blog about it), what I consider to be important and worth splurging on (family and friends), and what I need to work on (paying off debt, building a stronger emergency fund). And if you take the quiz yourself, maybe it will do the same for you! :)
The Financial Stability Test:
(The more you say “yes” the better)
1. You’re at peace with your money situation. Both yes and no. Given our circumstances, I'm ok with how we are handling our money situation. I hate being in debt, but I don't want to give up life experiences.
2. You don’t fight about money with your spouse. True. It's usually give and take. It all depends on who wants what, how much it costs, and how vehemently the other person disagrees. A $20 dress or top won't make Justin mad, but if I were to buy a new car, that might get under his skin. Fortunately, I know that and don't go out making big purchases without talking to him first.
3. You don’t use your credit cards often, or if you do, you pay them in full every month. False. BUT! (There is a but!) Three of our cards (the ones we don't pay in full every month) are currently at 0% APR. On our other cards (that aren't 0% APR), we purchase items during the month to earn points and cashback and, at the end of the month, we pay for those purchases in full as well as paying a little down on the 0% APR cards. (Our credit card debt is down by 60% from the beginning of the year. I think that counts as proof I'm doing what I say I'm doing…)
4. You’ve got a fully stocked emergency fund. Yes and no. We have more than many people, but less than others. See #5.
5. A job loss wouldn’t mean you couldn’t pay your bills. True. We could last for like 2 months. Potentially 3. But I'd probably start freaking at the beginning of month 2.
6. Financial emergencies don’t invoke panic. Truth. *Most* emergencies are less than $1,000 and since that seems like a low number to me, I just kind of roll with it. Oh we have to pay $300 more per person because we missed our flight and Air France sucks? Whatever. Oh I have to fix a broken iphone screen? whatever. #moveon
7. You’re okay with spending money on special occasions. Always. Spending time with friends and family is #1 to me.
8. The thought of being generous with your cash sounds exciting and not panic-inducing. Ummm… not really. With my friends and family, certainly. Putting money towards charity? I'm not that good at it. You have to wonder where the money is going and if it's actually going to help people in the long run. Plus, there are so many charities I'd help with that it's hard to pick just one.
9. You’re happy about your financial situation. Umm… meh. I want my debt to be paid off and I want the money to travel the world. That being said, I'm not super sad about my financial situation. There are definitely perks to being in debt and having to make every last dollar count. All of a sudden, it becomes necessary to actually care to the nth degree where your money is going and how it's being used.
10. Saving money has become a habit. No. Paying down debt has. (Kind of the same thing?)
11. Others’ opinions about what you have/don’t have don’t concern you. Meh. I care a little. I'd like to own a house. And if I had a house, I would care that it was clean and the items in it looked good together. But… I don't currently own a house. At the moment, my biggest concern is maintaining social connections and not becoming a loner, which I am pretty prone to doing.
11. Others’ opinions about what you have/don’t have don’t concern you. Meh. I care a little. I'd like to own a house. And if I had a house, I would care that it was clean and the items in it looked good together. But… I don't currently own a house. At the moment, my biggest concern is maintaining social connections and not becoming a loner, which I am pretty prone to doing.
12. Paying the bills never requires an in-depth plan. True. We have around 30 accounts, so paying bills is always complicated and takes at least an hour twice a month. However, it's not like we are wondering if we have enough money.
13. Retirement and/or kids’ college expenses are covered by a solid, working plan. Plan? Yes. Covered? No. Goal is to have debts paid off and strong retirement plan by 40. Assuming everything works the way we anticipate, that should be achievable.
14. Your debt-to-income ratio is below 30%. Nope. We're at 34%. Close but no cigar.
15. You’re thoughtful about purchases. Absolutely. If I purchase a clothing item and don't wear it in the first week, it's getting returned. If I don't have a solid plan for consuming a food item I buy from the grocery store, I don't buy it. Actually, if I don't have a solid plan for using something immediately (no matter what it is) I don't usually buy it.
16. Avoiding/eliminating debt is a priority for you. Yes and no. We could potentially pay off our debt faster if I didn't like clothes and travel. I just don't want my life to be consumed with it. I'd like to pay off debt fast, but I also realize that life is short for me and everyone around me. I want to make time for those I love as well as experience the world even if I can't pay off debt one year sooner because of it.
17. You budget. Or else you’re so good at spending wisely that you don’t need to budget. Yes. Or at least we have a rough plan that we try to stick to.
18. You have a plan for the unexpected. Yes. We have a high unused credit limit and enough money in savings to cover an emergency. We also have insurance. I think we will be fine if something unexpected comes up.
19. You buy appreciating as opposed to depreciating assets. False. We buy little things like clothing, food, computers, and cars as opposed to houses and CDs (the financial kind, not the music kind!). But the majority of my clothes could be sold on ebay for more than I bought them for; does that count? ;)
20. Large purchases don’t create a damaging ding in your finances. Yes and no. If we've saved up, obviously the answer is no. If we've bought because of a good deal, we might be hurting our emergency fund depending on how big of an expense the purchase is and what time of year we do it in. Otherwise, Justin's paycheck can and has covered some pretty big expenses in the past few years.
Here’s the key to see where you rank:
• 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.
I got 11.5, so I'm glad to see I'm doing very well. Hopefully I'm on my way up… How are you doing? Feel free to take the quiz and share your results with me below. :)
