Implementing Good Financial Habits

Anyone who has accumulated wealth over time, has made saving a habit. Like any new habit, starting good financial habits will take a lot of work at first. However, after an adjustment period of a few days or weeks, you'll be well on your way to financial success for the rest of your life.

Successful Financial Habits – Having Goals

No financial plan is complete without setting first achievable goals. Make your goals unique. If you want to buy a million dollar house, that's great. However, make sure that is a big enough "why" to keep you motivated through the ups and downs. Decide what you really want, and then go after it.

Successful Financial Habits – Budgeting

Learning how to create a budget is not as difficult as it sounds. However, it's a new habit that will take a lot of work to implement. Occasionally you will be able to budget without even thinking about it.

If you choose one habit to implement at first, make sure it's budgeting.

Successful Financial Habits – Calculating Your Net Worth

Calculating your net worth will give you an overall picture of your finances. It's the best tool for knowing where currently stand, and where you need to go. Without a net worth, how do you really know if you made an improvement from last month?

Successful Financial Habits – Monthly Reviews

Goals, budgeting, and net worth calculations do you no good without reviewing them. A good time frame for reviewing each is once a month. All it takes is an hour. Calculate your net worth. Then, go over your short and long term financial goals. Last, review your budget to see if your spending was in line with your short and long-term goals.

Successful Financial Habits – Paying Yourself First

There is no better way to save then paying yourself first, and learning how to live on the rest.

The opposite of this habit is saving what's left over. Which we both know, your spending will increase to your current level of income.

Try setting aside a certain percentage of your income to various goals, as soon as it's earned. Treat every financial goal like your 401K.

Successful Financial Habits – Limited Information

You must keep yourself updated to a certain extent. Recent changes in the tax code, higher contribution limits or a new way to save for retirement, are things you want to keep up on. You do not want to watch CNN every evening for 30 minutes for your financial news.

It does not really matter what happens in the market today, if your horizon is 30 years off.

Any information you¡¯re receiving should have a specific purpose and should be actionable.



Source by RJ Weiss


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