A 2016 study found that 46% of Americans do not have enough cash on hand to cover a $400 emergency expense like a car repair or a hospital visit, pointing toward a widespread problem with financial stability for many people. If you’re living paycheck to paycheck or struggling with money in other ways, you might be wondering what it means to be financially secure and how you can get there.

Here are a few key elements of what being financially secure means, and how to achieve financial security for you and your family:

A Stable, Reliable Income

Being financially secure means having a secure source of income. Looking inward, this means asking whether you have a good job and are confident that your job is not going away anytime soon. And do you see potential for future growth in your income?

If the answer to all three of these is “yes,” you are probably on the path to financial security. Of course, there are no guarantees in life and even a great job can go away for reasons beyond your control; but, in general, if you have good career skills and good work habits and a strong network of career contacts, you’ll be more likely to recover from any career setbacks and stay on a long-term path of career growth and prosperity.

If you don’t like your job, if you’re in a declining industry, or if you feel like you are vulnerable to being laid off, act now. Think about how you could improve your job skills or change jobs, perhaps in another field of work. Start networking and doing informational interviews to learn about a new career field that you’d like to work in. Think about moving to a new city that has better opportunities in your career field.

Being financially secure means having options and being prepared to pursue better options. Don’t wait around to be a victim of circumstance; take your destiny into your own hands — because the best time to find a good job is when you already have one.

A 2016 study found that 46% of Americans do not have enough cash on hand to cover a $400 emergency expense.

Control Over Your Monthly Spending

Do you have a budget? Do you know where your money goes each month? Are you able to get through each month with few unpleasant financial surprises, or are you constantly running out of money?

Create a budget and use a budget-tracking tool — there are lots of great apps and online tools available to help track your spending. Or, do it the old-fashioned way and write down all of your monthly expenses on paper. If you have visibility into your monthly spending, you can feel — and be — more in control of your bills, instead of just reacting to external events.

Building Toward Long-Term Financial Goals

Financial security is not just about day-to-day spending — it’s about long-term security like retirement savings, estate planning, saving for kids’ college, and other long-term investments.

If you haven’t already done so, make sure you’ve set up a retirement savings account. If you get an employer match to your retirement savings through your company 401(k) plan, make sure you’re contributing at least enough of your pretax income to get the full matching amount. For example, employers may offer a 50% or 100% match of the first 6% of your income that you contribute to your retirement plan.

If you don’t have an employer-sponsored retirement plan, you can set up one of your own with an investment firm. You can even set up “target date” retirement savings funds that put your savings on auto-pilot for the rest of your career.

Ability to Recover From Setbacks

Being financially secure also is about being resilient. If you’re living paycheck to paycheck with no savings, or if you are reliant on an unstable source of income (a low-wage job that could go away at any time), you are not going to have security.

Financially secure people have emergency savings, lines of credit that they can draw upon if needed, and may have insurance to help protect against big losses — such as life insurance, disability insurance, homeowners’/renters’ insurance and personal liability insurance. Talk to an insurance professional about your insurance needs.

Make sure you have three to six months of living expenses in the bank to help recover from a job loss or severe illness or other life-changing event.

Freedom to Have Fun With Money

Financial security may sound boring, but it’s really not — being financially secure is also about being financially free. Ideally, when you have enough money to be secure, you also have enough money to have fun. Financially secure people can afford to travel and splurge on some special purchases and have some comforts in life, because their basic needs and risks are covered.

Of course, this doesn’t mean you should live extravagantly; frugal living is a great strategy for long-term financial security. But it does mean that if your bills are paid, your savings are adequate and your investment strategy is on track, you should give yourself permission to have some fun with your money from time to time.

Perhaps the biggest lesson from people who are financially secure is this: They are not afraid of money, but they respect what money can do for them.

Being financially secure enables you to build a strong, vibrant, varied life. It gives you the confidence and self-assurance of having enough money to do what’s really important to you, and to take care of the people you love, without having a lot of stress and anxiety about money. Financial security isn’t meant to be a prison; rather, it’s a valuable safety net.

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