Most people understand that setting good financial habits and discipline is critical to reaching their short-term and long-term life goals.
A common hurdle many people make when working to improve their financial lives is becoming overly ambitious; rather than systematically tackling the issues at hand.
The bright side is that there’s an easy way to get on the right path.
This way, you can gradually take up habits that build up to other intricate practices, beneficial to you – professionally and in your personal life.
It's a good idea to plan before carrying out any task.
Therefore, your first step toward building wealth is to have an actionable plan by prioritising all your financial goals, from most to least important.
Review your transaction history, and identify and prioritise compulsory expenses (like transport fare) and non-essential expenses (like lunch break takeout).
Here are a few ideas to help keep this goal, at the top of your mind:
Essentially, the role of your “accountability buddy” is to check in with you every day.
For this to be a workable agreement, work together to set a specific check-in time and the check-in session duration (keep to under an hour) - to keep these sessions collaborative, focused and productive.
It's as easy as it sounds.
Here's an illustration; recount how often you check your email and social media accounts daily (I bet it’s a couple of times a day).
So, why not include your investment, current, and savings accounts in your screen time rotation?
Before long, you'll be in the habit of checking your accounts daily.
Some benefits to this as a daily goal are:
As such, you identify how you’re doing and celebrate your wins (not by overspending, though). This does serve to give you cause to stay motivated and on course.
Read Also: 8 Amazing Benefits of Tracking Your Spending
No amount is too little to save.
Taking advantage of the free access to automate your savings makes it easy to start developing the habit of saving.
The best way to do this is by directly transferring money to your savings accounts.
Do so by automating transfers to your savings bank account and/or your mobile money savings account.
For example: if you save Kshs.10, 20, 35 (etc.) daily, technically, you only need to set up recurring transfers once and automate your savings. These savings eventually add up to a tidy sum that contributes to the success of achieving your short-term and long-term goals.
Are you confused about budgeting? Have you given up on investing because you can’t figure it out? Does debt repayment sound too complicated to learn?
These questions do resonate with many, and you're not alone.
And after all, everyone has doubts or assumptions they hold on to, which lead to unproductive financial habits and choices.
This is why your financial literacy is key to your financial well-being for wealth development. Let's start by getting into what financial literacy is.
According to the National Foundation For Educational Research, “financial literacy is the ability to make informed judgments and effective decisions regarding the use and management of money."
With that in mind, it quickly becomes clear how credible information is necessary to educate and inform on financial topics you need to understand.
Your learning journey doesn’t have to be overwhelming or complicated.
To simplify your learning process - write down some topics you want to learn or be more knowledgeable about.
Secondly, pick a topic and work on it at your own pace (remember, you don’t have to be a financial guru, but you should take it in stride).
Here are ways you can make this a stress-free, daily habit:
Finally and importantly, is to address the personal biases that encourage you to follow through on impulse choices.
Why? Because your habits, values, and attitudes do impact how successful and unsuccessful you are in handling different situations, including financial situations.
The correct way to avoid yielding to impulsive financial actions is to strive to be disciplined. Don't strive to be perfect!
Here are a couple of simple habits you can practice daily, to avoid the impulse-buying trap:
Wait at least a week before making a purchase that is, or can be, marked as an impulsive buy. Say, for instance, buying an extra pair of shoes you want because they’re on sale and not because you need a new pair of shoes.
The five habits above are easy to work into your current routine and maintain.
However, even if you're working toward one or two new habits a day, it takes time.
Now, get at it and aim to keep at it.