Personal finance may be personal, but some basic ideas are universal---emergency savings, employer match, and living within your means. How to be good with money.

It’s a phrase we throw around all the time—“good with money.” More often than not, we throw it around in the negative, talking about people being “not good with money”—spending on stupid stuff, never saving, etc. But what does it mean to be good with money? 

To be good with money back in the day was far different than it is now. Credit card debt was low (or non-existent), people always used cash, and the cost of living was lower.

But that’s not our current reality. It’s not easy to save money and still live what’s considered a “normal” life.

Fear not, if you’re doing some of these things, you’re well on your way to being good with money. Here are 6 indicators that you’re good with money.

1. You have SOME emergency savings

This may be surprising, but 62 percent of Americans have less than $1,000 in savings. Another 21 percent don’t have a savings account at all.

Why is this happening?

First, banking has changed. You’re getting little to no interest on your money when it’s stashed away in savings, so people feel that sticking it under the mattress is once again a viable option.

Banks are also charging all kinds of crazy fees now. Things like low balance fees, overdraft fees, and account closure fees disproportionately hurt people who don’t have much money to begin with, making it all the harder for them to save. 

Young people are often now saddled with a lot of (mostly) unavoidable debt—student loans, an auto loan for that car they need to get to work—and pretty seriously high expenses—rent in a costly coastal city, the high costs of food in the same.

And it’s not just recent grads who are feeling the pinch. The cost of living has risen at a significantly higher rate than wages for the past 12 years. We’re paying more for our stuff without getting paid as much more for our work.

If you have at least some emergency savings in this day and age, you can check off this category for being good with money.

2. You take advantage of your employer’s retirement match

I’m just going to be blunt here: If you aren’t investing enough to get your employer’s full retirement match, you’re making a huge financial mistake.

An employer match on your retirement contribution is free money. A study recently showed that collectively, we’re missing out on over $24 billion in employer matches. That’s a lot of extra money.

You should, at the very least, be contributing enough money into your company’s pre-tax retirement account—401(k), 403(b), etc.—to get the company match.

Still thinking you can’t afford it? Most companies provide a match that’s under 6 percent—in fact, the average is only 2.7 percent.

If you make $40,000 per year, for instance, that’s about $41 per paycheck (if you’re paid bi-weekly). That’s a minuscule amount of money, and if you can’t afford that, my advice is to find other ways to cut back because you’re missing out on free money.

If you’re contributing at least enough money to get your employer’s retirement match, you’re good with money in this category.

3. You save cash for purchases instead of using debt

The average US household with debt carried about $17,000 in credit card debt in 2023. It’s relatively easy to get credit these days.

If our budget is stretched and we can’t afford something, typically we’ll put it on a credit card, make an excuse as to why, then justify it by saying we’ll pay it off next month. The problem is “next month” never seems to happen, and thus begins the debt snowball.

I had a colleague tell me that once you have kids, you just “have to supplement your income with credit cards,” as if it was a known fact and the only way to live. Scary.

So instead of satisfying your need for instant gratification, hold off on making any purchases unless you have the cash to pay for them. I have a rule thumb for making purchases:

First, if you want something (even if you have the cash to pay for it) and it’s a bigger purchase, walk out of the store, go home, and sleep on it. If you still want to make the purchase the next day, it has to then meet two qualifications:

  1. You have to have the cash to pay for it (no credit)
  2. You have to decide that it adds to your quality of life

The second one is a big deal. Even if you’ve slept on it and have the cash to pay for it, if it doesn’t truly add to your quality of life, it’ll probably end up in a junk pile or at a garage sale one day.

If you’re already saving up cash to make big purchases instead of putting them on credit, consider yourself good with money.

4. You look for value—in both purchases and investments

Last year, I was driving home from work and listening to the local sports talk AM radio station. I find that they have great shows, but you also get a lot of ads—corny ones, too.

One of the ads I heard that day still sticks with me today. It was an ad for a mattress, and the person talking kept saying that they “couldn’t afford to be cheap.”

Being frugal myself, I scoffed at this initially, thinking that it makes absolutely no sense. I went home, told my wife about it, I blogged about it, and I kept thinking about it.

Then finally it hit me. The person in the ad was right. None of us can really afford to be cheap.

Here’s what I mean:

I’ve purchased some really cheap stuff in my life, thinking that I was saving money. The prime example is my work shoes—a pair of Dockers I bought on Amazon for $50.

For those of you who aren’t familiar with men’s dress shoes, $50 is an absurdly cheap amount to pay. Do you know how long those shoes lasted me? No more than eight months.

Figuring I just wore them out over the winter, I bought another pair of the exact same kind. Another $50. Guess how long those lasted? About six months.

So in just over a year, I’ve spent $100 on two pairs of shoes. It might sound like a great deal, but if this cycle were to continue, I’d be spending about $7 a month on shoes ($100 / 14 months).

Instead, I should have bought one pair of nice, high-quality work shoes that would hold up and last. That’s what I’ve done recently, and they cost me just over $100.

My point is you should be looking for value in things you buy, and in investments you make (regardless of whether it’s stock or shoes). Value means the best quality for the lowest price.

Value isn’t always the cheapest option, but it’s also usually not the most expensive. Value is something you’ll have to determine yourself.

But my advice is to get the absolute best quality you can for what you’re willing to spend. Buy things that last.

If you’re already looking for value when you make purchases (and not just go for the cheapest option) you’re well on your way to being good with money.

5. You invest in things that appreciate (and avoid spending on things that don’t)

If you’re spending your money on things like cars, clothes, and other tangible items that don’t increase in value after you buy them, you’re on the path to not being very good with money.

Buying a new car is a great example. Sure, it might be mint condition, fully loaded, and have everything you want, but it’ll never be worth what you paid. It might not have been worth that when you bought it.

You should instead be looking at low-mileage used cars (see the point above about buying for value) and paying with cash. Go in knowing that it won’t appreciate in value, so take the lowest possible hit you can.

On the flip side, you should be putting your money into things that increase in value (appreciate). The easiest thing to think about is investing in stocks, bonds, mutual funds, ETFs, and index funds.

The lesson here is to focus on putting your money into things that will increase in value, not decrease. Avoid silly purchases that will end up in the trash in the not-too-distant-future.

6. You know when something is too good to be true

This is either the easiest or the hardest for most people. Some of you can recognize a scam when you see it, others….not so much.

The best advice I can give you is when you’re looking to buy something, invest in something, or do anything at all with your money: If there’s any doubt in your mind on what you’re doing with your money, it might be too good to be true. If it seems all upside, and no downside, all reward and no risk, then it’s probably too good to be true. 

If something seems like a scam or too good to be true, hold off and investigate a little further. Odds are that product or service will still be there (in some way, shape, form) when you are ready to spend those hard-earned dollars.

If you’re one of those people who can easily sniff out a scam and always know when something is too good to be true—kudos to you. You’re good with money.


What it means to be good with money in 2017 is a lot different than what it meant in, say, 1957. With easy access to credit, a high cost of living in coastal cities rich with jobs, and a consumer economy way beyond anything our grandparents could ever dream of, it’s hard to save, stay within your means, and focus on the future.

But if you do even half of these recommended steps, you’re doing better than 75 percent of your peers.

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About the author

Chris Muller picture
Total Articles: 279
Chris has an MBA with a focus in advanced investments and has been writing about all things personal finance since 2015. He’s also built and run a digital marketing agency, focusing on content marketing, copywriting, and SEO, since 2016. You can connect with Chris on Twitter.