In any aspect of life, success doesn’t happen overnight. It is, more often than not, a result of many good habits that you have developed and worked hard to stick to for a significant amount of time. The same is true when it comes to achieving your personal financial goals. Here are some simple but effective personal finance habits to start with.
1. Track your monthly income and expense and create a budget.
2. Live below your means. Try spending less than your average earnings.
3. Settle your bills in advance to avoid unnecessary late payment penalties.
4. Pay for your bills online as much as possible to save on time.
5. Avoid impulse buying, especially for big-ticket items.
6. Stay away from shopping centres and online shopping sites when you are depressed. Retail therapy can be addictive and costly.
7. Think of the future by having a retirement plan.
8. Settle the whole amount on credit card bills instead of making minimum payments to avoid high-interest rates and APR fees.
9. Make an effort to educate yourself about insurance and investments.
10. Save at least 15 per cent of your monthly income.
11. Have an emergency fund worth of six months expenses available in case something unexpected comes up. For instance, unemployment.
12. Get an individual savings account (ISA) that best suits your needs.
13. Clear yourself from all forms of debt, starting with whichever has the biggest APR fee.
14. Build your credit card score by following the 30% rule, meaning not having a balance over 30% of your total credit limit.
15. Diversify your portfolio by exploring different sectors and spreading your investments.
Bonus tip: get a personal financial advisor
A personal financial advisor can help you efficiently reach your financial goals. He can honestly and expertly assess your current financial status and develop a plan tailor-made for your age, income and other important factors.
Albert Goodman is a full-service accountancy, tax, financial planning and business advisory firm with 150 years in the finance industry. We are best known for giving professional, reliable and proactive financial advice. To discuss your personal financial planning concerns with our experts or to request a callback, please complete the contact form on our website.