In my work I’ve met many women who have made and grown wealth for themselves and their families. And as I’ve talked to them about how they created and sustained that wealth, I’ve noticed certain patterns. So many of us many of us didn’t grow up with strong role models of how to create wealth. Maybe you’d like to make more money, but you’re unsure: What are good money habits?
Very few of the wealthy women I spend time with didn’t wake up one morning with a huge number in their bank accounts, and then learn how to manage that money. Instead, they developed strong financial skills which led to the wealth they enjoy. Financial skills spring out of good money habits. As part of our 10-Week Wealth Turnaround we focus on 10 good money habits. I’ve picked off 5 of these that can implement no matter what the balance in your account right now. So, as you read this today, think: which of these will you implement first? Let us know how you go in the comments!
What are good money habits? 5 starting points to get your money working for you
1. Millionaire women know why
The really wealthy women I know are always clear on one key thing: the answer to the question WHY?
And the answer has a couple of parts.
First they understand WHY they are in the financial position they are in. They take ownership of the good decisions and bad decisions they have made. They bring consciousness to every spending, saving and investing decision.
The second part of the answer to “Why?” is the WHY they’re BUILDING that wealth. When it comes to earning, managing and multiplying their money, they have a clear vision for their money. They know what’s important to them, perhaps their family, their business or their desire to give to the causes that really matter to them. No matter what they have something fuelling and driving their desire to grow wealth, beyond “I just want more money.”
Action: Set aside twenty minutes to journal your WHY when it comes to money. Answer the following questions:
- Why are you in the financial position you are in. What good choices have you made, and what not good choices have you made?
- What do you want money for?
- What would life be like if you were receiving the kind of income you want?
- Why is money important to you – does it represent approval, stability, security, power or freedom, for example?
2. Millionaire women are accountable
We’re talking about money habits, but accountability starts with taking responsibility for our own power. The millionaire women I know are really clear about where they put their energy. They don’t lay blame, justify, or make excuses when it comes to their results. If they want things to be different, they take responsibility for making the changes that are needed.
They’re also accountable to others around them, answerable to any promises they’re making.
Finally, they’re accountable in the more usual sense of their financial accounts. They know what’s going in and what’s coming out when it comes to their money.
When we look at the stages of wealth, accountability is one of the key ways we move from financial instability to a place of financial stability. So if right now you’re not sure whether you’ll be up or down financially from month to month- the first and most important habit you need to implement is the habit of accountability.
Action: It can take a few hours to get a clear picture of your finances, so make time for it. Schedule a coffee date with yourself to get really clear on where things are: your debts, savings, and what’s coming in and out for the month. Getting a clear picture of where you are is essential if you’re to start steering your financial ship in the direction you want to be going.
3. Millionaire women manage their money effectively
This habit probably doesn’t come as a surprise – after all, we’re talking about women who are millionaires. They know how to manage their money effectively to make sure that they’re creating the financial future they want.
You might have read things like this before and thought: “Fine, I need to be ‘effective’ – but what does that actually MEAN?”. Well, at the very least, it’s about allocating something towards your financial future every single month – making that a part of the work your money does however much you earn right now.
In the great book The Millionaire Woman Next Door Thomas Stanley shares that 68% of millionaire women know exactly how much they spend every month on living: mortgage, fuel, food etc. They are brilliant budgeters. Of the other 32%, the “non-budgeters”, they make a commitment to INVEST money first each month and then only spend what is left over.
Either way millionaire women organise the money they have, and routinely put some aside to invest (not save) for the future.
One of the biggest mistakes I see women making is thinking that they’ll start to invest their money when they’re making “enough”. Most of us will never grow the kind of wealth we want without a commitment to investment right from the start. Just telling ourselves we’ll invest what’s left over isn’t sufficient. We must start the investing habit first. Creating your financial future means becoming conscious of the flow of money through your accounts. When we start to plan for the future immediately, we open up the amount of focus we give our financial future. So even if its $1 a month, starting the habit of investing in the future is the crucial step.
This is how we start to become truly conscious of our finances.
Action: Are you confident you understand the flow of money in your life? If you’re not really clear on how much you’re earning or spending, go back to the previous step – getting a clear picture of your finances is essential before you move into actively managing your money. Once you understand what’s coming in and out, you can start looking at what you want to invest in your future. Even if it’s only a small amount at first, this habit is one that will pay off in the long term. How much will you commit to investing monthly?
4. Millionaire women get their money working for them
In a culture which encourages us to continually spend, spend, spend, the millionaire women I know don’t only play the role of consumers in the marketplace. They’re in the habit of seeing themselves as creators of opportunity.
That means thinking of money as a way that we can make things happen for ourselves and for others, not just through our spending but through our investments. Investors see their money as a way of creating opportunities, whether that’s through property, the stock market, becoming a partner in a business, or something else.
Action: What would you like your money to do if it was working for you, instead of the other way round? Brainstorm a few priorities to investigate further, if this isn’t a part of your current finances.
Not sure where to start? Move on to habit 5 – it might be time to make some financial education your first investment.
5. Millionaire women educate themselves
If we start early enough in life, and have the right level of income, simply saving part of what we earn could possibly lead to wealth. But for most of us, creating the wealth we want to requires a little more. Usually our money needs to work a little harder than your average savings plan allows, to really provide for a financial future.
Most of us aren’t born knowing this stuff, so the first step is education to learn how to get our money working harder than a 0.5% annual interest rate in a bank!
Action: When it comes to finances, what do you wish you knew more about? Real estate investing? Stocks? Precious metals? What interests you to learn more about? Do a quick bit of reading today. Great authors on the subject are:
Rebecca Robertson of Evolution Financial Planning.
Gill Fielding of Fielding Financial.
Barbara Huson of Barbara-Huson.com, Author of one of my favourite books on financial power for women “Sacred Success”
Wealth Insights is our own half-day foray into reclaiming your power when it comes to money, and really increasing your wealth. Click here for upcoming events.
The bottom line when it comes to creating good money habits
At One of many we believe wealth is one of the most important areas of women’s power, and we’re on a mission to empower every woman in our community to create and manage the wealth she wants.
Do you recognise these habits in yourself? Is one of them a particular challenge for you, or an area where you have a tip to share for someone else? Let us know in the comments – your experience might be just what another woman needs to read today.
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