Successful people have a lot of positive habits in common especially with regard to their financial choices and habits. Financial independence and success are the result of hard-work and developing positive money habits. Wondering which financial habits of successful people could help you transform your finances?
These are 16 important financial habits of successful people you should implement right away. They include some major but seemingly simple things you may be taking for granted.
1. They take budgeting seriously
Before money gets out of your purse or credit card, it must be budgeted for. This is the first most important step to ensuring that your money is put to good use. Not sure how to budget? Technology makes it easy. You can use a good personal finance app to help you match your income with expenditure and manage your money more efficiently.
2. Track their expenses
Track your expenses and know where a chunk of your money is going. This helps you to assess your financial pattern and adjust if necessary. Tracking expenses makes it easy for you to know how much of your money is going out and how much is coming in. By doing so, you are able to know whether or not you are making the right investment and spending on the right things. Knowing this helps you adjust your spending.
3. They choose quality over quantity
Value is important. When making purchases, successful and financially independent people understand the need to choose which items will last longer compared to those that are many but will become redundant and useless in no time. This habit is important and will help you to save a lot of money instead of spending money buying multiple inferior products.
4. Successful people invest their money wisely
Using your money to make more money is important than buying every trendy or designer item that comes on the market. Find the right way and invest your money wisely.
5. They prioritize saving
Saving money for a rainy day is a vital financial habit every person must possess. You may not be able to control what happens to you tomorrow but you can control how you respond to it if you are financially prepared. Therefore, make saving a habit and save as much as you can.
6. Diversify Income
Knowing that you can rely on multiple sources of income is important to help you live a comfortable life and attain financial freedom. Standards of living are rapidly increasing and you need extra money to cater for bills and other expenses. Especially if your job is not a good paying one, it is wise to diversify your income. Get a side hustle!
7. Plan for retirement
Successful people plan for retirement. They either contribute to a private retirement fund or a pensions scheme. Whether you are married or single, it is crucial to plan for when you are old and feeble. Your future self will thank you for this.
8. Spend less than you earn
Spend less than you earn to avoid borrowing at all times. This is an important rule and can help to transform your finances. Spending less than you earn ensures that you have surplus money to save, invest, keep for an emergency or use in a way that will secure your future.
9. Push for a raise
If you think you deserve a raise, ask for it. Rather than sit and bite your fingers for what is likely to happen if you ask, go ahead and ask for a pay raise. You will never get what you want until you take a bold step, make a move and ask for an increment in your salary.
10. Avoiding debt is key
It is key to avoid debt as much as possible to prevent yourself from spending a lifetime paying debts owed. Successful people avoid debt and pay off debt as quickly as they can.
11. Speak to the right people before making any big move
Before investing, becoming a guarantor in a loan agreement, using property as collateral or borrowing on behalf or someone, speak to the right professionals for guidance and financial advice. This minimizes your risk of investing in a venture that you are unsure about which could lead you to money trouble or bankruptcy.
12. Spend Smart
People who manage their finances wisely do not pay for subscriptions and services they do not need. Also, they buy things they are sure they will use and love and not just to compete unnecessarily or show off. It is also smart-spending to buy in bulk and eliminate wastage.
13. Automate Finances
This helps you keep your hands off money you must save or invest. Automating finances is one sure way of not getting under the influence of spending money recklessly. When you automate, you won’t see the money, so you will not be tempted to spend it on things you do not need.
14. Successful people use unexpected money wisely
When you receive money in the form of a gift, get paid for a job you did not see coming or get money in any other unexpected way, it is important to use it wisely. People who are successful with their finances are not tempted to rush and spend the money at a party or a night out. Rather, they save, invest, use it to pay off debt or utilize it in any other beneficial way.
15. Think long-term
They do not only think about short-term gains only; they think long-term and relate it to the the implication of their financial choices.
16. They are in the company of achievers
As Jim Rohn said, you are the average of the five people you spend the most time with. If you want to be successful financially, watch the people you spend time with. If the people in your circle love to visit expensive restaurants or go to a party every night, you just may be spending a lot of money on those things without realizing it.
If you want to get out of debt, save money and be empowered, Dave Ramsey has documented a straight-forward game plan to transform your money habits in The Total Money Makeover.
Do you know other positive financial habits of successful people? Leave them in the comments section below. Meanwhile, you can join our 7-day self-improvement challenge here.
If you are unsure about how to manage your money, I am convinced you will love Dave Ramsey’s Complete Guide to Money.
You may also be interested in:
12 Dave Ramsey secrets to help you save money
How to save money on groceries on a small budget
1 comment
Nice write up. Picked up a thing or two new very useful information. Thanks