Mastering your money can come down to establishing a few smart habits. After all, “habits are the cause of wealth, poverty, happiness, sadness, stress, good relationships, bad relationships, good health, or bad health,” as written by Thomas C. Corley in his book – “Change Your Habits, Change Your Life,” a culmination of his research on hundreds of self-made millionaires.
Below are some smart money habits to cultivate:
- Track your spending:
The first money habit you need to develop if you haven’t yet is – tracking your spending. That means every naira you spend, even for small purchases.
Here are some different ways you can track spending:
- Record your expenses in a spreadsheet
- Write them down – an expense tracking worksheet
- Use an app or software
It doesn’t matter so much which one you choose. What’s really important is getting into the habit of tracking what you spend consistently.
- Budget! Budget! Budget!:
A budget isn’t some terrible thing that resigns you to a life of eating rice and beans forever. A budget is just a plan for how you spend the money that comes in each month. You might need to experiment with a few different budgeting systems to find one that works for you. And that’s okay. What’s important is getting into a budgeting groove that you’re comfortable with.
- Surround yourself with successful, high-earners:
Who you hang out with matters more than you may think. In fact, your net worth tends to mirror that of your closest friends. Successful people generally agree that consciousness is contagious, and that exposure to people who are more successful has the potential to expand your thinking and catapult your income. This is because we become like the people we associate with, and that’s why winners are attracted to winners.
- Avoid Impulse Spending:
Impulse spending is one of the worst money habits you can fall into. This is because it’s so easy to spend money without planning it or even thinking about it.
The bad news is that impulse spending can eat away at your budget, leaving you with nothing to save. The question then is – how do you break the impulse spending habit? One trick that works well for some people is imposing a 48-hour wait period on bigger purchases. It’s a simple enough rule. If there’s something you want to buy, you wait 48 hours before going for it. That’s long enough to decide whether you truly need, want and can afford whatever it is you’ve got your eye on.
- Automate Your Savings:
You can simplify your life a bit and ensure your bills are getting paid on time by automating your finances. You can set up automatic bill pay and even have money automatically transferred to your savings accounts. You still need to regularly review your finances, but this is a great way to take control of your money.
- Grow your money by investing:
To grow your money and build real wealth, you need to start investing. Investing your money can increase your income and secure your financial future and the good news is – you don’t need a ton of money to get started.
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