Build Your Personal Finance Future: Top Advice To Become Rich
1. If You Convince Yourself That You Need to Buy Something, Don’t Buy It
One of the biggest financial mistakes is to buy things unnecessarily. We often do this: we buy new clothes, a phone or a computer, just to keep up with others and feel fashionable. But most of these things we don’t really need.
When something is really needed, you understand it right away. If you have to convince yourself before buying, do not make this purchase.
2. Don’t Skimp On What Makes You Happy
Money can buy happiness if you spend it on experiences and things that matter to you. If they delight, inspire, and motivate, it’s a necessary investment in your well-being.
Just remember that the pleasure of things passes faster than emotions.
After two weeks, we get used to new things and stop noticing them. Impressions make us happy much longer. They can be mentally re-experienced. They also help us grow and develop new skills.
3. Earn More And Spend Less
Many people start spending more after their payday becomes more. They buy an expensive car, travel more often, and eat in cafes. As a result, they do not become richer but remain approximately at the same level of prosperity. But if you earn more and spend less, there will be free funds. They can be deposited or invested.
Think about how you could earn more: take additional responsibilities at your current job, find a part-time job, and freelance. Then think about how to spend less. For example, cook at home and go to cafes more rarely. Spend less on clothes. Sell your car and use public transport. Don’t chase the latest fashions. Use the remaining funds to pay off debts or save up for something.
4. Try to Avoid Debts
No matter how rich you are, if you have debts, you are a slave to the banking system. To pay them and maintain the necessary standard of living, you will have to work. Maybe it’ll be a job that you don’t like.
Even if you think “I need 2000 dollars now to start my own business or create some kind of project”, then think again, because for this you may need to borrow money. Start only when you can pay all the expenses yourself. So you risk less. And the lack of funds forces us to look for a creative approach to problems.
Based on the statistics, In total, US household debt, including mortgages and non-mortgage loans, is approximately $14.3 trillion, and you probably don’t want to become a part of that system.
But if you have a debt, firstly you need to pay it off to make your financial situation more stable. You can take a personal loan because it’s suitable for non-discretionary purposes such as debt consolidation.
5. Stay Away From Ads
We do not even notice how advertising makes us want to make a purchase. Avoid it by all means. Don’t watch TV, don’t read magazines, turn on your browser’s ad blocker. Unsubscribe from newsletters. Buy paid versions of apps to disable ads.
Try to isolate yourself from advertising for a month as much as possible. Then evaluate whether you began to think less about shopping. And check how much you saved during this time.
6. Don’t Help Others, Until You Ensure Your Own Financial Stability
If you have trouble with money, don’t lend it to anyone. Even a family member. You will worsen your situation and, in addition, spoil the relationship.
It is better not to lend money to friends and family at all. If you want to help, give them for free. This is the only way you can maintain a good relationship. But help when your own financial situation is stable.
7. Strive Not For Wealth, But For Not Going Broke
If you are a business owner, focus not on how to increase profits, but on how not to go bankrupt. If you are an employee of a company, think about how to stay fit. For example, you can learn new skills or expand your responsibilities.
8. Don’t Give All Your Money To Investments
If 99% of your funds are invested in real estate, you are deprived of financial freedom. In an unforeseen situation, you will not be able to pay off and will have to borrow.
Try to always have free funds that can be quickly withdrawn from the account. This is also useful in case there is a profitable opportunity to invest in them.
9. Appreciate Yourself
If you are an entrepreneur or freelancer, charge a little more for your services than you think you deserve. You may lose a few customers, but in the long run, you will make more profit.
Of course, when you’re just starting out, you can’t ask for too much. To gain experience, work for some time for free. But then charge for services above average. If you agree to average pay, you will always have to somehow make ends meet.
10. Do What You Love In Your Free Time
Many people want to quit their office job and do what they love: become a photographer, a traveler, or a writer. Don’t do this until you have financial stability. Pursue your dream business in your spare time.
Wake up an hour earlier, use your lunch break, and do something useful in the evening instead of watching TV shows. When the money from your main job is enough to pay the bills, you can leave the annoying company. But always have contingency funds and a backup plan ready. You may have to live with your parents again or return to your old job.
11. Create an Airbag
An airbag is an amount that you can spend on unforeseen expenses. For example, to fix a car or buy medicine in case of illness.
This security measure allows you to save money that is usually spent on monthly needs and for long-term goals. Also, this amount allows you to be calm for your safety in case of loss of your job.
If nothing unforeseen happens, this amount will become a contribution to your investment portfolio.
12. Set Goals And Set Aside Monthly For Big Purchases
Simple calculations will help determine the amount that needs to be set aside and the period during which you must make a purchase.
13. Learn And Improve Your Skills
Learn something new, take courses and training, read literature. Become a valuable specialist in your profession. Make a business. It’s not hard to learn. It will certainly lead to an increase in your income.
You must always study. This is a necessary requirement of modern reality.
Make a learning plan and start implementing it. Be sure to include personal growth coaching in this plan.