- Smart Investing
How financially secure are you? Take our quiz and find out.
We are all working toward financial security. How are you doing in achieving that goal or surpassing it? Please answer yes or no to each question.
Do you already know where you rent or mortgage payment for next month is coming from.
Do you feel comfortable that you can spend about the same for food, insurance, utilities, loans and all other “fixed” expenses (expenses that you can’t choose not to incur) that you did last month without going further into debt?
Could you handle a small financial surprise (car repair, speeding ticket, trip to visit sick parent) without going further into debt?
Can you comfortably finance 1 or 2 holidays a year with your current income?
Are you maximizing your RRSPs?
Are all of your major life expenses (your education, buying a home, raising children and their education) behind you?
Do you own your own home with less than 50% of the value of the house in a mortgage?
Are you debt-free except for a mortgage and other investment-related debt?
Could you buy a second or third property (perhaps a vacation home)?
If you were to quit your job today, do you have enough money to live and spend about 75% of what you were spending while you working?
Results: Give yourself one point for each question where you’ve answered yes.
Your score is 0-1: Financial Insecurity:
Unfortunately, you do not yet have any kind of financial well-being and likely feel stress about your financial situation. Perhaps you are just starting out or have experienced a difficult time lately (lost a job). Keep focused on your goals and you should see improvements.
Your score is 2-5: Financial Security:
Nice Job! You’ve got the point where you feel confident that all of the costs that you MUST pay every month (your fixed costs) can be covered. Certainly you have to be careful but you can go to sleep knowing that you’ll have enough to pay your critical bills. This is an important milestone and for most people, they start to worry about money less.
Your score is 6-8: Financial Independence
Congratulations! You’ve gone beyond feeling confident about paying the bills and have now accumulated enough wealth to be able to quit your job or change your job to something that makes much less money to pursue your dream. While you still have to live a careful lifestyle, you are not locked into a work situation that you may not enjoy.
Your score is 9+: Financial Freedom
Wow! You have enough wealth that you can buy anything you want (within reason) and not worry too much about it. It is much more about having money – it is having the freedom to be who you really want to be and do what you really want to do in life. Of course there are many different levels of financial freedom. For the ultra-wealthy, they don't have to think about any purchases, but for most in this category there is still a level of purchase that would require some consideration.
Most wealthy people will tell you that it isn’t the money that makes them feel rich; it is the feeling of financial well-being and the freedom that the money gives them to do what they want. The journey to financial security can be a long one but definitely worth the trip. Learn more about smart investing on our site