Focus On Improving Your Financial Habits

Do you need to improve your financial habits?

Most of us probably do have room to improve some financial habits, but we don’t know where to start.

Changing Any Habits Is Not Easy

They says that on average, it takes more than 2 months before a new behavior becomes automatic — 66 days to be exact.

Of course everyone is different and the time it takes to change a habit can vary widely depending on the behavior, the person, and the circumstances.

In one study on habit changing it was reported that it took anywhere from 18 days to 254 days for people to form a new habit.

It may be difficult to change a habit, but it can make a huge difference particularly improving your financial habits.

Think About The Well off People You Know

In a recent article called the seven habits of the financially well-off the author commented on seven habits that she said people that have money are focused on.

These are;

  1. They don’t waste money – we often talk about budgets and making sure we do not waste money, but most of us still do. We know that budgets are hard to stick to, but with the right budgeting software you can get more focused and start to improve your spending habits over time.
  2. They price check their lives – it’s a good idea to review your expenses on at least an annual basis and ensure that you are not paying too much. Reviewing your mortgage is easy with a good mortgage broker, insurances can be reviewed using a broker too, and utility bills is another area that can be reviewed easily using one of the comparison websites.
  3. They never pay early, but just in time – you want to maximise the use of money which means keeping the money in your revolving credit account or offset account until it is needed, but then also not missing any discount for paying late.
  4. They fiercely protect their credit score – credit scores are becoming very important when you need to borrow money. It’s not good enough now to just have no defaults listed with a credit agency, now the lenders can see if you pay your bills on time so poor account conduct can mean they say “no” when you need to borrow money.
  5. They minimise their tax – how many of us pay too much tax? Most of us believe that we are paying our fair share but don’t really check where we can minimise tax.
  6. They wage war against debt – paying interest is often seen as wasted money, and especially when the debt is not for a business or investment. As mortgage brokers we have a mortgage reduction system that works on changing habits to pay your mortgage off much quicker and that can save you literally thousands of dollars.
  7. They aren’t squandering their greatest asset – time. This is extremely important with paying off debt, savings and investment. The sooner you get started the better, but so often we have a reason to delay something that we will later regret.

These are all things that we can do if we just think about our finances more carefully, but they are also things that we don’t necessarily focus on.

How To Change Your Financial Habits

The first thing that you need to do is accept that you need to make a change.

The second thing is to actually make a start.

You cannot change your current situation unless you commit to doing something.

Change at least one of your financial habits today and see what a difference that can make.