There are no overnight success stories for wealth.
Anyone can form smart saving habits, and if done right, will ensure forward movement with building real personal wealth. Applying these saving habits adopted by wealthy people won't be easy at first, but can be implemented by all for a healthy and growing foundation of wealth.
Find Your Strengths and Weaknesses
Every wealthy personal has started somewhere and has had their fair share of obstacles to overcome. The road to wealth looks different for everyone and has separate and unique strengths and weaknesses. Finding your individual strengths and weaknesses and creating a plan around these variables will set yourself up for personal success and wealth.
Become Financially Aware
It's easy to forget to not actively monitoring the actual income and expenses each month. However, it's now seemingly effortless to stay updated with your finances and track your spending habits through website applications or smartphone apps.
Another benefit from becoming aware of your finances is identifying recurring or subscription fees that could be downgraded or even eliminated if you do not use it anymore. Do you still use your gym membership? Do you still listen to that music streaming service as much as you used to, or can you stand to downgrade to the free version? It is easy to lose track of where your money goes, especially if it is an annual recurring payment. Uncovering these hidden fees can have a substantial impact on your financial situation when you become aware and sensibly manage it.
Most importantly, wealthy people have a way of keeping things in perspective. Sure, you might only be able to put five dollars towards your million dollar goal. However, that five dollars brings you that much closer to a debt-free life with substantial savings.
Make Saving a Priority
Saving should be a priority for every individual regardless of their financial situation. Finding the savings sweet spot can be tricky, but as a rule of thumb, 20% of each paycheck should be deposited into a savings account. Getting into this habit can difficult as it will limit the spending power that you're used to but over time will yield significant results.
Live Below Your Means
Many wealthy individuals have adopted this concept of living well below their mean or potential spending power. For example, the Las Vegas-based David Sapper, who owns a successfully used car business, and his real-estate broker wife make a combined income of $500,000 per year. They can live a lavish lifestyle but prefer to live like “secret” rich people, only spending $2,500 per month on all bills and extracurricular expenses like eating out, unlike many of their peers. Through this, they have been able to put away 90% of their income into savings and investments, which will allow them to retire early according to a Forbes article. The amount of income should not determine the level of spending but instead the amount of saving.
Set Smart Goals
Having a goal has been a highly touted habit, and it is said to increase everything from productivity to focus. If you have a target to focus on, you will keep things headed in the right direction whether you realize it or not. Consider using a budgeting and bill tracking interface, like the famous Mint website or app. Mint shows you your current financial standings and the progress you are making. The application can bring a sense of clarity when the mountain you are climbing seems overwhelming, and it gives insights into how far you have come in your endeavors.
According to TD Ameritrade, "The rich understand that it starts with personal goals—what you want to get out of life and how you might prioritize your list. And once you have an idea what you want to accomplish personally, you can plot a financial roadmap to help steer you there. In other words, the path to wealth can involve starting early, and focusing on the long term. If your financial goals are clear and you’ve planned well, you don't necessarily need to follow every market tick. But you should be aware of how your portfolio performed on a quarterly or annual basis and be ready to re-balance assets if necessary."
Carrying a positive attitude may seem silly, but you can not overemphasize the importance of remaining positive. It can be hard, especially at the beginning, to see the light at the end of the tunnel. Through dedication and preserverence, the goals that you have set for yourself will start to materialize with time. If you have a mountain of debt or if you have no savings, you must set a reasonable goal for yourself and take one day at a time.
Adopting these healthy money saving habits won't be easy but with the right planning and determination can turn anyone into a wealthy individual over time.
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