Most of us want to provide for our own needs without external assistance, a quality known as self-sufficiency. Not only does it feel good to support yourself with your own skills and efforts, but it increases confidence and reduces stress. If you’re not dependent on anyone else, then you are free from fear that the resources you need to survive will be taken away from you. Self-sufficiency is at the heart of a relatively new concept known as financial well-being.
The Consumer Financial Protection Bureau (CFPB) defines financial well-being as “…a state of being wherein you:
- Have control over day-to-day, month-to-month finances;
- Have the capacity to absorb a financial shock;Financial shock describes unforeseen expenses or lost income (e.g., job loss, illness, injury, death, home or vehicle repair).
- Are you on track to meet your financial goals; and
- Have the financial freedom Financial freedom is different for each person. Generally it means having the ability to make decisions about your lifestyle, do the things you want to do, and enjoy life. to make the choices that allow you to enjoy life.
Consumer Financial Protection Bureau (CFPB), Financial well-being: The goal of financial education.
Write Your Definition of Financial Well-Being
There is no good or bad level of financial well-being — it depends on how you define it for yourself. Briefly write down your own definition here:
I feel the best financially when .
The next few sections will help you analyze your career (or the one you would like to have), focusing especially on aspects of financial well-being.
Your Self-Sufficient Wage
A self-sufficient wage is the amount you must earn to meet your basic financial needs. The amount varies based on your household and lifestyle, where you live and your current outstanding debts.
What Does It Cost You to Work?
When calculating what your own self-sufficient wage would be, consider not only your take-home pay, but what it costs you to work. How do these costs affect your household budget?
- Transportation – gas, parking, bus or train fares, tolls, tires for your car, oil changes, wear and tear on your car
- Clothing – business attire, uniforms, dry cleaning or additional laundry costs
- Meals – the cost of eating away from home during the day or grabbing dinner on the way home
- Memberships – union dues, professional associations
- Supplies – tools or equipment for your job, treats for co-workers or students, publications for your own professional growth
- Child, elder or pet care – day care or special programs for children, adults or pets
Are Your Wages Sufficient
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