Have you ever wished you could save more money and learn how to manage your finances better? Most of us have to handle our money by ourselves. This can be a challenge, especially if you don’t have any prior experience with this. The best way to make sure you’re constant with the money you spend and the way you invest the ones you save is to develop certain money habits. However, you have to be very careful about what kind of habits you decide to stick with. Some of them can be extremely damaging to your finances. Today, we’re going to provide you with the views of 3 financial experts on the issue of money habits that can bring success.
3 Expert Views on Effective Money Habits
1. Practice Mental Accounting
Mental accounting is the practice of dividing your money into different piles that you use for different things. The trick, says Stephen Dubner, co-author of the best-selling book “Freakonomics”, is to be disciplined. First of all, once you establish what you’re going to use each pile of money for, you should stick to the plan. This means you can’t take money from one pile to place in another and so on. In Dubner’s opinion, it’s important to know how to mentally manage your money. Second of all, it’s good to take care of urgent things that you have to pay as soon as they come up.
2. Save Automatically
One of the greatest benefits of today’s increasingly technology-dependent world is the fact that we get to automatically save money. This doesn’t only save us the effort of thinking about this task each month, Farnoosh Torabi, host of the podcast “So Money with Farnoosh Torabi” says. It also ensures that we don’t need to exercise willpower every month thinking about whether or not we should save money or use them for something else. Relying on automatic transfers means that each month, a specific sum of money will be withdrawn from your account. The sum will then be transferred into a separate one where you can collect all your savings. Torabi advises people to set aside at least 10% of their monthly income.
3. Create Streams of Money
Matt Theriault, host of the podcast “Epic Real Estate Investing”, doesn’t believe in saving money or making money. He thinks the best approach to financial success is to create streams of money. If you’re confused about what this means, allow us to clear that out for you. Theriault refers to business opportunities that offer high rewards with the lowest risks. For instance, one of his suggestions are internet businesses. Even though he admits that opening such a business is not easy, the same way as earning easy and sustainable money isn’t either, he still finds it to be one of the best solutions to a healthy approach to money.
These money habits suggested by financial experts have definitely inspired us to consider a better money management strategy, and we hope they did the same for you.
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