Ever worry that no matter how much you save, it’s not enough to meet your long-term financial goals? You’re not alone. A recent survey found that nearly two-thirds of Americans worry about money on a regular basis, regardless of their income level.
Your bank account might not be flush with cash, but that doesn’t necessarily mean you’re not on the right track for a bright, comfortable financial future. Here are five reliable signs of future success.
1. You’re able to set financial goals
You might be worried that your current financial goals aren’t enough to create the standard of living you want now or in retirement. But the ability to set goals—and stick to them—is an achievement all on its own.
The ability to set financial goals is the difference between planning ahead and reacting to needs or expenses as they arise. In other words, it’s the difference between saving for the future and going into debt to cover expenses you didn’t anticipate.
Even if you’re worried you aren’t saving enough right now, setting goals and hitting those marks will help you develop great personal finance habits. As time goes by and your income grows, you can increase your savings and embrace more ambitious goal-setting.
2. Your net worth is rising
Your net worth includes all of your debts—things like student loan debt, credit card debt, mortgage debt, and so on. But it also includes your assets, including cash savings, your retirement funds and investments, your home equity, and even the value of your car.
As time goes by, you want this net worth to rise. It’s normal for young adults to have a negative net balance because of car payments, student loans, and other types of debt accrued early in life.
Every month, as you save a little bit and pay down those debts, your net worth rises. This financial progress may happen slowly, but it’s progress that will make a big difference over time.
3. You have good credit—or you’re rebuilding your credit
A strong credit score is something you earn. If you’ve got one, it’s a sign of financial responsibility and trustworthiness as a borrower. It will help you qualify for lower interest rates, credit cards with higher rewards, and other financial benefits.
But if you have a low credit score, the good news is that you can rebuild it over time. Paying down debts, maintaining financial accounts in good standing, and paying your bills on time are all easy ways to increase your credit score over time.
Even when you don’t have the income or savings you’d like, a strong credit score will serve as proof of your inevitable financial success. Protect that score by keeping up those healthy financial habits.
4. You stick to your monthly spending budget
The ability to set a monthly budget and restrict yourself to its spending limits is no small feat. No matter what level of income you have, budgets are important. Someone earning $50,000 a year can save more than someone making $150,000 if they are more committed to living within their means, sticking to a budget, and making a plan to save every month.
Budgets should be practical enough to account for all of your spending needs, but they should also set reasonable yet firm limits on frivolous spending to keep your finances in check.
5. You have an emergency savings fund
Everyone faces financial emergencies at some point in their lives. Maybe you suddenly lose a source of income, or you have an urgent need to purchase a car or cover medical expenses.
In any case, it’s useful to have an emergency fund saved in a dedicated bank account. Experts recommend maintaining a savings account with enough funds to cover three months of living expenses. If that’s more than you can afford, save what you can now and make incremental contributions to the fund until you’re able to reach this level.
Achieving financial security is a process. For many people, the path can appear riddled with uncertainty and doubt. But if you follow the advice of financial experts and develop excellent discipline and financial management skills, you’ll put yourself in a position to become a financial success.