4 Daily Habits of financially intelligent people

4 Daily Habits of financially intelligent people
“Don’t think about what you can buy with your money. Think about how that money can generate more income for you.

If there’s one thing I’ve 4 Daily To improve your finances, it’s more important to change your habits than to make more money.

Even if you make a lot of money, you can still go broke if you don’t have good money habits.

But if you have good money habits, you can change your life.

If you start good money habits now, they will pay off for years.

They invested their money.
If you give 10 000 dollars to a random group of people, 95% would only think about what they could buy.

But 5% of people would think about how to invest the $10,000 to help them reach financial independence faster.

Most people think like consumers, but only a few feel like investors.

“It’s not difficult. Refrain from thinking about what you can buy with your money. Start to think about what you can do with your money.”

— J.L. Collins (author of The Simple Path To Wealth)

People who are good with money use their money to make more money.

Instead of spending their hard-earned money on things they don’t need, they put it to work by investing it in something that brings in money.

People who think like investors use their money to get free and be on their own.

And that’s the rich people’s “secret”:

They don’t just work for money; they also let their money operate for them.

You can make passive income through dividends, rental income, or capital gains by putting your money into stocks, index funds, or real estate.

One day, the passive income you get from your assets could replace the active income you get from your job or business.

Peter Lynch, a famous investor, said, “Money is a great friend once you put it to work. It gives you extra money without you having to do anything.”

You should put your money to work by buying financial assets instead of fancy things.

They fight against lifestyle creep.
Most people spend everything they earn, which is a sad fact. Any money that comes in today will be spent tomorrow.

Of course, many expenses are unavoidable:

Mortgage/rent \sInsurance
Raising kids Utilities
Groceries
But many costs are pointless.

Whether it’s a fancy restaurant, expensive clothes, a bigger house, a faster car, or a slightly better smartphone.

This kind of spending is called “lifestyle creep.”

Lifestyle creep means that when your income increases, your expenses increase by the same amount to improve your life.

Even though it’s OK to reward yourself for your hard work, don’t let your lifestyle get out of hand.

People with lifestyle creep go through life thinking like consumers instead of investors.

Instead of thinking about how they could use their money to become free, they think about all the nice things they could buy.

When you make more money, don’t just buy more fancy things. Instead, buy assets that bring in money and help you get out of debt.

They permanently save money.
If you want to get rich, you’ll need to get into the habit of saving money regularly.

Peter Lynch said in Learn to Earn, “Save regularly whatever you can afford, whether it’s $10 a month, $100 a month, or $500 a month.”

Some people in the personal finance world say you shouldn’t save because your money’s buying power goes down over time because of inflation.

Technically, that’s true, but I think it misses an important point:

Saving is the most important thing you can do to improve your finances.

If you don’t save, you can’t build up an emergency fund to help you if something terrible happens with your money.

You need to save money to put into assets that bring in money.

You need to save to make significant changes in your life.

Start putting away as much money as you can. This is the key to being financially healthy.

They are always getting more intelligent about money.
Getting rich can sometimes mean making a lot of money. It’s more important to know how to handle your money.

As Robert Kiyosaki said in Rich Dad, Poor Dad:

“It doesn’t matter how much money you make as much as how much money you keep, how hard it works for you, and how many generations you keep it for.”

That’s why it’s much more important to know how to handle your money than to know how much money you make.

People who make a lot of money but have yet to learn the basics of money management tend to spend (or lose) it quickly.

Statistics show that 70% of lottery winners end up broke, and 33% go bankrupt within seven years.

Many famous athletes and entertainers who made millions in their careers also went bankrupt:

Mike Tyson made more than $300 million during his career, but in 2004 he went bankrupt.
Johnny Depp made more than $600 million in his career, but he almost went bankrupt.
Nicolas Cage made more than $150 million in his career, but he almost lost it all in 2009.
Even if you’ve made hundreds of millions of dollars, these examples show that you can still lose it if you need to learn how to save, invest, and manage your money.

Robert Kiyosaki said, “Money without financial smarts is soon gone money.” Because of this, it’s important for everyone, no matter how much money they make, to learn the basics of money management: pay taxes, sell stocks, put money into property, plan to get out of debt, make a budget for monthly costs, differentiate between assets and debts
When you learn how to handle your money this way, you’ll be better off for the rest of your life.

Remember that only some people who make a lot of money become wealthy. The people who become rich are the ones who know how to handle their money the best.

It’s people who have learned how to handle money well.

Read more: https://nancyexplores.com/diplomacy-ways-to-develop-critical-diplomacy-skills-in-a-workforce/