How do you measure your own financial success?
This question popped up in an email i got from AskMen.com, asking if I wanted to participate in a survey. Now normally I just glance over and then delete/archive as my A.D.D. brain can only take so much. But seeing how it was the "Great Male Survey of 2009", who am I to turn it down? Okay, well in reality they were smart enough to bold out some of the financial questions in the email ;) While most of them got my brain thinking, there was one question that really stood out:
How do you measure your own financial success?
Good one! First, each of us should probably define what "financial success" is. Is it money? Job title? How big your house is (better not be)? Everyone has their own thoughts on it. The first thing that comes to MY mind is net worth and my budget (naturally). Net worth because it gives me an overall financial snapshot of how we're financially holding up in life. It's something I can track on a monthly basis and see how successful (or not) we're doing. I think of my budget next because if I'm sticking to it and it's working, then I've had a successful month ;)
Okay, so keeping in mind what you feel financial success is, here are some of the answers given for the question (along with my own experience on the right of each "answer"):
- Against that of my friends. - No way! Well, maybe partial-way ;) What they do doesn't affect me financially by any means, but I do notice that whenever one buys a new car or a bigger house, I tend to analyze how exactly they were able to do that. Stupid, but true.
- Against that of my industry colleagues. Hmmm, nah I don't really compare anything here. I probably get paid more for what I do at my current job than similar positions in my industry, but that's just cuz I lucked out and found a perfect fit.
- Against that of my father. Wow, good question. I feel like I would maybe down the road when I get into my late 30s or 40s, or probably even when I have kids, but at this moment of time it's not a thought for me. I do, however, totally listen to his thoughts on personal finance and investing!
- Against my own financial goals. Ding, ding, ding, we have a winner! I 100% believe this is where we should all fall. I say "should" because most of us still keep those previous people in mind whether we want to or not, but that's just human nature.
posted by J. Money at
7:48 AM
12 Comments:
I won't pretend to be as noble as other folks might be. I most certainly measure my short-term financial success against my friends and peers. By that measure I'm rocking like Mick Jagger on a 'farewell tour'.
My goals are fairly high but they are made with the knowledge that financial success is inevitable. That is certain; to what degree I achieve that success is the only unknown.
I think I judge my financial success by counting my net worth every month. If I am growing my wealth and living under my means, I am usually pretty happy with the success I am having. I don't really look at what friends and family are doing, as I don't have the exact goals they have. At the end of the day I just want to be able to give my kids all the opportunities that I had growing up and having enough to give to the charities I see fit (oh and be able to go on surf trips once/twice a year). Overall I think I am already pretty successful and blessed!
I agree that it only really makes sense to track your financial success against your financial goals. You cannot control how successful other people are. You can only control your own actions. If you set realistic and achievable goals, then those are what you should measure your success against.
Oh, excellent question. I'd also throw in how I measure up against my siblings, but we all manage our income, credit/debt, priorities so differently. For me, it all boils down to "can I afford the things I want out of life". For me, that's mostly travel experiences and classes to learn new stuff when the mood strikes me. Except for this shakey year, I've been measuring up quite nicely since I divorced my spendy ex in 1997 no matter what my income level, which has varied in that time from $400 to $2000 a week, and spans 3 continents (success right there!).
Hm. Today has been full of excellent, perplexing questions. I have to go with my own financial goals as well. I also like to think of it as "How good am I doing compared to the average 20yr old?". That always makes me feel better! ha.
Well, given that I can't work, I have a hard time measuring my financial success compared to most people. That doesn't stop the urge to do so, of course, but when it happens, I remind myself that it's not that simple.
In addition, I can't measure against my overall financial goals. We're still working toward those. And because of our financial difficulties, we have to make very incremental progress.
So I measure our success by the fact that we continue to make progress. That we don't move backward.
@The Weakonomist - haha, i like the way you think brother ;) thx for your honesty!
@Atlas@mymoneyshrugged - wonderful! big fan of tracking net worth for sure...many of us are def. blessed no matter how it may seem sometimes.
@Olivia @IndependentBeginnings - yup, no doubt. easier in theory though, i always catch myself initially comparing to my friends and colleagues - but once I catch myself I'm back on track ;)
@MoneyMateKate - wow, i didn't know you were married once! soo interesting, but glad you're rockin' it out and all is well now :) having a super spender as a partner sure makes things hard, I always feel bad when I hear stories like that.
@Kaitlyn - that works :) I def. compare myself to the average 29'er at times, I like doing that better than someone in particular...
@Abigail - Continuing to make progress is a most wonderful goal! I'll second that for sure.
I'm with The Weakonomist as I compare myself to friends all the time. Except in my case I'd be the roadie.
Really the article gives an insight on financial success.
When I can wake up in the morning and no one owns my day, then I will consider myself sucessful.
Cars, houses and things mean nothing compared to financial freedom.
Love that Bret! Gonna actually throw it on Twitter right now and spread the word ;)
Every person has some goals in the life, financial goals are the prime goals of the life. There are three steps for making financial life sound, such as you should take some loan to invest, if you return it after earning enough money then it will called as good debt. For achieving financial goals saving is must, saving is the best way to enjoy secure future. Use part of your saving for investment but invest after proper research and in good sector. All the above point can give you financial success and accomplish your goals. For more details on financial success refer financial success
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