5 Signs You’re Way Better Off Financially Than It Feels Like You Are, According To A Financial Educator
There's no doubt that it's hard out there, but if you have any of these 5 things going for you, you're on the right track.
shurkin_son | Shutterstock There's no doubt about it: The current economy is a bit of a nightmare, even if you're lucky enough to have some semblance of stability. It is becoming harder and harder to succeed, and that makes the future feel all the more daunting. But a financial educator says that it might not be quite as bad as you think.
Patrick Di Cesare is a financial educator and writer whose TikTok channel, @basicfinancialliteracy, is full of insights and resources about personal finance and economics. He says that if you've achieved any of these five distinct financial milestones, you're in a much better position than you might believe.
Here are 5 signs that you're way better off financially than it feels like you are:
1. You don't have a car payment
If your car is paid for, you're several steps ahead of the game. "The average new vehicle payment is $738 a month right now," Di Cesare said, citing statistics from credit agency Experian.
Average used car payments aren't that much better either — they're currently sitting at $525 a month. That's a huge chunk of change just to get to and fro.
Di Cesare says if you've been fortunate enough to avoid this situation, "change the oil often, do all the recommended maintenance in the owner's manual, and drive that thing into the ground." Because while car prices have started to come down slightly, they're still massively inflated — and if the president-elect's tariff plans are implemented, they're likely to balloon ever further in 2025.
2. You have no debt outside of a mortgage
LOL, that's like five people (just kidding… but sort of not). But Di Cesare said "the average American has over $23,000 in debt," which is pretty staggering.
So if the only place you're in hock to is a mortgage company — no credit cards, no student loans, no car notes — you are way ahead of the game compared to most of your fellow Americans.
3. You can cover a $1000 emergency with cash
We've all heard the statistics — the average American can't afford an unforeseen $400 expense, like a car breakdown, medical bill, or appliance failure. That's a pretty dire set of circumstances.
Di Cesar says if you've got at least a grand sitting in your savings account, you're leaps and bounds ahead of most people. Sure, all it takes is one false move to evaporate that money, but having it on hand makes the difference between a brow-furrowing struggle and an actual catastrophe.
4. If your mortgage has an interest rate below 4%
"If you're able to get a mortgage at less than 4% in the last few years," Di Cesare said, "you're looking really smart right now." This is because, of course, interest rates are still relatively high — currently at 7.75% — in order to keep inflation under control.
It's also because of the still lingering aftereffects of interest rates being at or near 0 throughout the 2010s to recover from the Great Recession. The impacts of that long period of low interest are still reverberating (including coloring our perceptions of what a normal interest rate is).
So if you've got that sweet 4% or lower mortgage? Your mortgage payments are way below most people's. "The difference between [7%] and a 4% mortgage…on a $400,000 loan for a 30 year-mortgage is 751 dollars a month," Di Cesare said.
5. You have anything saved for retirement
Sure, it's likely not enough — now or for the future. Retirement is a real pickle for basically everyone who isn't already in retirement as we speak! But Di Cesare said if you have any kind of nest egg, even if it's itty bitty, you're "doing something right."
That's because the statistics on Americans' retirement savings are pretty grim, to be honest. One in five Americans over 50 have no retirement savings at all, and neither do nearly half of boomers — all of whom will be over 65 by 2029.
So if you've got even one of these five things going for you, let alone two or more, give yourself some credit and thank your lucky stars — you've managed your wallet well (or you've just been REALLY lucky), and you're definitely on the right track.
John Sundholm is a writer, editor, and video personality with 20 years of experience in media and entertainment. He covers culture, mental health, and human interest topics.