5 financial habits to improve your finances better than 99% of people

Achieving financial stability and improving financial conditions is a goal that many seek. However, reaching this goal requires adopting healthy and sustainable financial habits.

Sticking to healthy financial habits not only means saving money, it also involves learning how to spend smartly, controlling debt, and making informed financial decisions away from emotional influences. In this article, we'll review five financial habits that can help you improve your financial situation in a way that exceeds 99% of people. Whether you're looking to save more money, pay off your debts, or achieve long-term financial goals, adopting these habits can be a turning point in your financial life.

Pay yourself first

One of the most important financial habits you can adopt is to pay yourself first. This means saving and investing a portion of your income before you make any other expenses. In George S. Claason's The Richest Man in Babylon, this idea is presented by the figure of Irshad, the poor writer who became the richest man in Babylon by following the first law of wealth: "Save at least 10% of all that you earn and do not confuse your necessary expenses with your desires."

It's good to start from anywhere, saving a little is better than not saving at all. The most important thing is to build a new habit that makes some of your earned money work for you, rather than for someone else. After you've paid yourself, you can use the rest of your income to pay bills and buy what you need.

Spend less than you earn

One of the biggest problems many face is spending more than they earn, which leads to continuous debt accumulation. This unhealthy financial behavior can make you increasingly dependent on credit cards, and with no monthly balance repayments, incurring high interest and fees that can take years to repay. To avoid this problem, you must learn to distinguish between what you really need and what you just want. When you think about buying something, ask yourself if it's necessary or not. This critical thinking will help you avoid unnecessary spending and achieve a better financial balance. By doing so, you can turn the surplus into savings and investments that help you build a more stable financial future.

Don't let emotions affect your financial decisions

Many people associate their financial habits with their emotions and how they feel. It can be easy to fall into the trap of spending when feeling disappointed, angry, or even joyful. While emotions have a role in our lives, they are not helpful when it comes to making financial decisions. Therefore, it is important to make thoughtful and logical financial decisions away from emotional influences. Develop a habit of deliberation and good thinking before making any financial decision, whether it is a purchase, savings, or even an investment. Making decisions based on specific logic and data will help you avoid financial mistakes that you may regret later. Thus, you will be able to build healthy financial habits that support your long-term financial goals.

Control your debts

Debt is not necessarily always negative, in some cases debt can be a positive step that helps you get closer to a more prosperous future. For example, buying a home with a mortgage loan is a type of debt, but it may be necessary for you. Borrowing money to improve your quest can also allow you to get a better-paying job.

On the other hand, using credit cards to cover additional spending is generally considered a bad use of debt, as repayment terms and interest can be prohibitive if repayment is not made on time. It's generally a good idea to avoid carrying credit card credit from month to month, as this can become very expensive in the long run.

Consult a professional financial advisor

When it comes to managing your money, planning wealth building, securing your future, and developing an effective plan to achieve your goals, it's important to talk to a professional financial advisor. A financial advisor provides you with extensive knowledge and experience that is difficult or impossible to achieve on your own. Perhaps the primary benefit, more than anything else, is the opportunity to relax. You can feel quite comfortable knowing that there are people who take care of various challenges and questions that you may have to deal with on your own. If you have any questions or concerns, you can contact the financial advisor for timely answers.

In conclusion, by adopting these five financial habits, you can significantly improve your financial situation and achieve the financial stability that many lack. Remember that it takes time and patience to build healthy and sustainable financial habits. By committing to providing a portion of your income, controlling your expenses, making informed financial decisions, and controlling your debts, you will be able to reach your financial goals faster and more effectively.

It is important to remember that financial success is not just about achieving financial savings, but also includes improving the overall quality of life. When you set yourself clear financial goals and commit to achieving them, you will find that you have the ability to take control of your financial future and secure a decent life for you and your family. With time and commitment, you will be able to achieve financial stability and improve your overall quality of life, enabling you to enjoy a life free of financial anxiety.