Your financial health is dependent on your ability to minimize your debt and to save money. While that may seem difficult to accomplish in these complicated financial times, it is the proven method to start to get financially ahead.
Once you have developed the ability to save money and minimize your debt, you can start to invest and have your money work for you. It is only then that you can assure yourself a luxurious retirement.
Here are 5 habits that I read about recently that should help you achieve your initial financial goals.
1. The habit of restraint.
Restraint is comprised of patience, dispassion, and self-control. It's the ability to resist temptations--most notably, impulse buys.
2. The habit of experientialism.
Experientialism is defined as "the philosophical theory that experience is the source of knowledge." It's used here as a juxtaposition with its opposite--materialism. If you've heard people talk about how they'd rather have experiences than things, well, that's part of it.
3. The habit of frugality.
Does frugality just mean being cheap? Not exactly. True, producers live beneath their means. (Almost by definition, if you're debt-free, you're living below your means.) However, this also incorporates a willingness--even an eagerness--to find deals and negotiate.
4. The habit of strategic thinking.
At its simplest point, this habit is just about thinking before acting--and having a plan. Again, it involves forgoing impulse purchases, and spending money primarily where it creates a real and lasting benefit.
5. The habit of mathematical thinking.
Finally, and probably most important, there's the habit of thinking about math. I don't know how it is that so many of us manage to miss this simple point, but our financial system is based on numbers. Educate yourself about basic concepts--starting perhaps with the time value of money and the power of compound interest. And in a world where those who want us to act like consumers often try to hide the calculations behind any deal, they work hard always to find it.
I try to give you some solid advice on math and thinking long term on this site and in my book, The Confident Investor. You can purchase my book wherever books are sold such as Amazon, Barnes and Noble, and Books A Million. It is available in e-book formats for Nook, Kindle, and iPad.