Money Habits of Successful People that You Can Copy and Do Too
Q: My girlfriend’s parents are well off, or even rich, but looking at them you’d never know. I’m going to school and will graduate in a few years with a degree that I hope will help me land a good job, but is there anything I can do now that will help me become financially successful too? ~ Marty
A: Some of the most financially successful people are those who never show it. But if you look at what they do day-to-day in their lives, you can catch a glimpse of the financial habits that got them to where they are today. Financial success doesn’t come overnight or with only one smart money move. Anything worthwhile takes time and diligent work; earning your degree and becoming financially fit are no different.
The one thing all successful people have in common is that they set goals. They know what they want to achieve and find ways to make it happen. Once you adopt this mindset, you’ll be surprised how much easier it is too stay focused on finding ways to get what you want.
Here are 5 more things anyone can do right away to develop successful money habits:
1. Focus on the Positive; Avoid the Negative
Surround yourself with positive, like-minded people and look for situations that help you move towards your goals. To be successful, you need to rise above and constantly strive to do better. Let go of and avoid negative situations or people. This might mean turning a “reality” TV show off; spending half an hour each day reading to learn more; limiting social media use; or getting up an hour earlier to get a jump on your day’s activities. Identify your bad habits or what is dragging you down. Then take steps to avoid or eliminate it entirely and improve your odds of achieving your financial goal.
2. Be Actively Involved with Your Money
Financially successful people have a budget that they live by, they keep receipts and track their spending, they set money aside regularly in various types of investments (e.g. short term savings accounts and long term RRSPs), they check monthly bills and statements carefully and pay them on time, and they plan ahead for emergencies and the unexpected.
Whether you have a lot of money or are living pay cheque to pay cheque, these are money habits and skills that everyone can learn or refine.
3. Ask Questions and Increase Your Financial Literacy
The only way to learn is to ask questions and to seek out answers. Not knowing, or not being financially literate, is no excuse with so many free resources. Read books and blogs, attend a money skills workshop or webinar, talk to your banker, ask if your girlfriend’s mom or dad could pass along tips over coffee; seek out information and guidance from those you trust. Everyone starts out knowing nothing because we aren’t born with money skills. Don’t let that scare you; instead, make it your goal to learn more.
4. Save Money Where You Can – Learn to Live Frugally
Cheap and frugal are two totally different things and to be successful you need to learn how to live frugally in all aspects of your life. Put another way, live below your means and don’t try to buy happiness. For example, buy a good used car, don’t max out on your mortgage, pay your credit cards off each month, maintain a zero balance on your line of credit, and add to your savings with every pay cheque.
5. Earn More Money Wherever Possible
Financially successful people know what they want, have set clear goals to help them stay focused, and take steps at every opportunity to work towards their goals. They also know that clipping coupons and scrimping and saving won’t be enough. They look for ways to increase their income, and so should you. For instance, do you have a hobby that can generate a few dollars; are you able to tutor or teach someone a skill you’re good at; can you sell household items you no longer need; can you take in a student, tenant, or border; do you need to ask for a raise or look for better employment?
The Bottom Line on Developing Habits to Help Achieve Financial Success
Many people are afraid of trying something new because they think they will fail. Money skills take time and effort to learn. Developing new habits can be hard and everyone experiences setbacks as they work toward achieving financial success. However, this is normal; it’s how you view your setbacks that matters. I can assure you that at times, you will definitely fail. But instead of fearing failure, learn from it and find a way to use it to help you move forward.
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