What habits you need to learn from financially independent people?
The equation is not so plain and simple. It’s not you will earn more, and you get rich or financially independent, overnight.
There are few other conditions and parameters, if you want to be among those, whose financial worries are significantly less than most of the people.
We are talking about habits and practices that rich men in this world showcase, so as to be affluent forever.
If you believe, that your money personality is worsening with the passing of each day, and your financial well being is affected for bad, then this post is a must read for you.
Here are the top notch habits and traits that you should follow, when your aim is to take the path of financially independent people!
Do what you love to do:
This is the first and foremost step to success. If you don’t love what you do, then you can never achieve financial independence.
Money is obviously one segment of becoming independent, but mental peace and happiness also play a major role, in letting you live the life you want. If you, day and night, spend time in an unsatisfactory environment, where you are stuck only for money, then you are not going in the right direction.
Money will always come from the works you do wholeheartedly.
Thus, your primary concern will be to start doing what you want to do, instead of chasing money, wherever it takes you.
Remember, all financially independent people have a happening personal life and space. And what good is your money, if you don’t have the right mental state, life and relationships to enjoy with all that cash?
Save a lot more than you spend:
Next comes your ability to save money. Not all people excel at this part. You might be earning a lot, but if you don’t have the habit of savings, then you have nothing better than a paycheck-to paycheck lifestyle.
Your net worth determines, how much independent you are financially. And, net worth is calculated by the total wealth you own! So, any debt instruments, or money you took on credit, or even your income, is not the actual defined net worth.
Your savings is practically what indicates your total valuation.
Hence, when you are dreaming of financial independence, you should be pretty much focused on saving a good amount from your paycheck each month. And, you can do so by cutting down on unnecessary expenses.
You should only spend money on things that you need. Your wants can wait to be fulfilled, till you have accumulated sufficient wealth for taking care of luxury expenses.
You can keep a check on your expenses, and expand your savings by taking the help of budgets, or personal finance advisors.
Whatever it is, until and unless you are into hardcore savings, you can’t be financially successful.
Use debts wisely:
Those who say, debts are bad, have never understood money and finance in the first place.
Debts are to be considered as opportunities, and not as mere means to enjoy things you can’t afford. All financially successful people have made good use of debts, and took help of debts to make a firm financial standing.
There are good debts and bad debts. Consumer debts like credit cards, payday loans, and unplanned personal loans, are typically understood as bad unwanted debts.
They have high interest rates, and that is what makes these debts so hard to pay off. So, if you are already having too much of them, like credit card debt or payday loan debt, then you should try out some good debt solutions, to pay off these debts fast and save money on the payments at the same time.
On the other hand, mortgages, and other ‘asset building secured debts are really beneficial. These debt instruments increase your net worth, and helps you have physical assets that increases in value, with time.
Hence, debts are not bad. It’s how you use them, defines their character. And, make good use of them to get a better hold of your own personal finances.
Don’t let your money sit idle, make investments:
It is this what matters the most, I tell you. When your money is not working, your wealth will not develop.
Save as much money as you can, and drive it to various investment vehicles, proportionately. Both you, and your money should be working! Even better, your money should be working for you, when you are sleeping.
Consider yourself a mortgage, as I was talking about good debts. Then you can use up a certain amount to invest in mutual funds or index funds.
Do some studies about the market, and reflect back your knowledge in the share market, by investing in the right stocks.
No sensible, moral, and successful person, will ever stuff their money under pillow, and sleep on it each night, without any future plans of proper money application.
So, that’s what will make you financially independent and successful.
Whenever required, you should be taking professional help, and work out your financial decisions with proper planning!
You can surely be one of them at the top!
Just, be consistent in what you are doing, and love what you are doing. Bliss and happiness should come to you!
About the Author
Andy is a blogger at Penny Less Dad and financial writer associated with the Oak View Law Group. He is a debt expert and a member of several online forums where he shares his advice as well as tips to lead a financially independent life.
Twitter : https://twitter.com/andymasaki1