15 Aug

Great Habits for Financial Prosperity

August 15, 2008

You hear about them every once in a while: the lady that worked an ordinary job and her estate left over $4 Million dollars to her favorite charity. How did she get there? Was she the recipient of a sizeable inheritance? How could she accumulate such a large chunk of money? Today’s environment finds many people struggling with personal financial issues. How about the other side of the coin: what traits can you develop to put yourself (and your family) in good financial heath?

Know exactly where your money goes. This is about budgeting and the fact that it’s not the big purchases that sneak up on you. It’s the every day occurrences that you don’t think about much like eating lunch out every day. Get a notebook and keep track of your everyday spending for two months. Once you get a firm grasp on how much you’re spending, set yourself up a weekly allowance and hold yourself to a new and improved budget.
Know what you want your money to do. Set a goal (like retirement). Put a value on the goal (what you’d like to be able to spend in retirement). Then, set a timeline on when you want to get there. Last, put a plan into play (I need to put this amount aside monthly to get to where I want to be.
Don’t carry credit card debt or if you do, have a plan to pay it down. We all know the story. If you have debt at 18% interest, you’ve got to get out of it as fast as possible or it will dig you a very deep hole.
Invest in your job skills. If something happens to your present job, prepare to look “outside of the box” to get another position. If you have the chance to broaden your skill set in your present job – take it. It is all about marketability.
Don’t expand your lifestyle as fast as your salary. As you progress through your career and have a rising income, take small steps with your spending habits. You don’t have to get a new car just because your neighbor did. By keeping this thought at the forefront – you can be quite adept at lower cost of living.
Avoid pricey diversions. You just have to have that new ski-boat that actually hits the water twice a year and needs to be stored, winterized, and insured. Think about your purchase long and hard before you take the plunge. Maybe set a one-month time frame to mull it over and make sure it’s really the right decision.
Give back. Directly help others less fortunate. There is nothing that hits home and tells you how lucky you truly are than giving your time to people in need.
Life is a balancing act. The balance is where you find in yourself the ability to enjoy your family and your friends while keeping an eye on the road ahead. I do not necessarily advocate becoming the cheapest of the cheapskates; just keep looking for that sweet spot by keeping one foot on the path I’ve outlined above.

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