Top 17 Financial Tips to Live a Rich Life

financial tips

 

There is a gazillion things we can do to improve our life financially but it’s always hard to know what’s best.

To navigate this jungle, I asked 16 financial experts and bloggers to give you their best financial tips, tricks and strategies.

Here there are:

Stop impulse buying

I always say that the more expensive the purchase is the longer you should think about it.  It’s fine to take 30 seconds on a stick of gum.  When it comes to spending 5 figures on a car, you should spend a few months.  If after this “cooling off and researching period” you are still interested and it makes sense then maybe you should go for it.

This advice is meant to be used in conjunction with other personal finance advice. The idea is to reduce impulsive spending.

Lazy Man and Money

My easiest personal finance tip is as follows, and it can be useful to prevent going into credit card debt or overspending in general. Whenever you are considering a purchase of any sort (even if it’s something as small as a cup of coffee at a convenience store) ask yourself two questions. First, do I really need this? In many cases, you’ll find the answer to be no. If you do answer yes, then ask yourself – is there a way I can buy this for less? In the coffee example, you could brew it at home and save cash. If you’re checking out an electronic gadget at a brick and mortar retailer, use your smartphone and see if it’s available on eBay or Amazon at a better price.

Andrew Schrage (Money Crashers)

Purchased used gift cards with credit cards to save more money

I like to purchase used gift cards online WITH credit cards that offer a certain percentage of cash back for items we routinely purchase (groceries, eating out, etc). This helps save more money each month.

Aaron (Three Thrifty Guys)

Watch out for fees when investing

Many of us know that we should start investing as soon as possible. I know it’s somewhat boring, but it’s vitally important as time can be a great component to your investing. What isn’t spoken about as much is how much you’re paying to do that investing. Fees are commonplace, and we’re all used to them but what many don’t realize is that the investing world is full of fees. Those fees, if not watched out for, can cause you to lose a significant amount of money over time. With that in mind, my tip is to earnestly seek out how to lower those fees. In many cases that will come through things like your 401(k) or other possible brokerage accounts. Use tools like Personal Capital or Morningstar to analyze your investments to find lower cost alternatives. In many cases you should be able to find similar investments to what you’re already doing at a fraction of the cost. It’s your money, and you want to grow it, the last thing you want is to leave it in someone else’s pocket.

John Schmoll (Frugal Rules and Wise Dollar)

Do what works best for you

My best personal finance tip for anyone is just to do what works best for you. There are a million different opinions out there on how you should manage your money and different rules of thumb you should live by. But the thing about personal finance is that it’s personal. Each of us has a different background and different goals. Despite what some personal finance experts trying to sell a product may tell you, there’s no one best way to become financially independent. That doesn’t mean you can just wing it though. You should spend as much time as you can to learn about different approaches and take what helps you and ignore what doesn’t.

Ben Luthi The Wealth Gospel

Open up the ultimate savings account

Opening up a savings account for all “extra” money you get over the year. Refunds, reimbursements, money from Craigslist/eBay, birthday cash, found money on the ground, etc. I’ve started mine four months ago and already have $1,200+ in it! And if you don’t touch it (pretty important) it’ll only go up!

$J (BudgetsAreSexy.com and RockstarFinance.com)

Just start

Just start. Many people will do tons or research trying to decide between load or no load mutual funds, ETF’s, dividend stocks, etc and suffer from paralysis by analysis. Start with a small amount and invest into something.  Anything.

The first investment I made was a load mutual fund that really wasn’t that great.  But at the time I didn’t know much about mutual or investing, really.  Buying that fund allowed to track it, check my statements and then do more research on what other options existed.  The experience you’ll get from making your first trade is invaluable and you’ll learn more by doing than researching.

Jeff Rose (Good Financial Cents)

My best financial tip would just be to get started. Sometimes debt is overwhelming, or you feel you’ll never be able to save anything on such a tight budget. If you do nothing, months, years go by and you are still barely breaking even. Try to save $1 per week. Yes, it is nothing, just saving the change in your pocket will do, so it should be no problem. Then try to save $2 the following week. If you do that for a year and manage to save $52 on the last week, you will have over $1,300 saved. Just because you got started. It is never too late, but the best day to start is today.

If you are in debt, you can do the same thing by throwing those extra amount at your highest interest debt. If it start hurting too much, just stay at the last level you were comfortable with. $10 a week is still much better than nothing.

Pauline Paquin (Reach Financial Independence)

Calculate the future costs

My favourite personal finance tip is the “future pricing strategy”. The idea is to calculate the cost of something not at its current price, but instead at its future cost.

For example, as a 30 year old, with an estimated return of 8% above inflation and a retirement age at 66, the rule of 72 suggests that I have to multiply the price of something I buy now by 16 (as I have 36 years and my money doubles every 9 years) to put it in terms of its cost when I retire.

Therefore, say I’m about to splash out $40 for a meal. In my head, it now actually costs $640. All of a sudden, I’m not so keen to eat out tonight!

Graham Clark (Money Stepper)

Don’t pretend you can’t trim money off of your budget

Too many people focus on one side of personal finance – either saving money on expenses or earning more income.  To really get ahead, stop neglecting half the battle.  Don’t lie to yourself pretending you couldn’t possibly trim money off of your budget or that you don’t have any time or skills to earn extra money.  Those excuses usually don’t hold any weight.  It’s usually more a matter of not wanting to make any kind of sacrifices.  Just keep in mind how those sacrifices could essentially be giving you a raise.  And who wouldn’t want a raise?

Jeremy Biberdorf (Modest Money)

Make more or desire less

Two things to keep in mind when it relates to personal finance. The first is that financial freedom occurs when income from assets exceeds your monthly expenses. And the second is that there are only two ways to get rich: make more or desire less. I try and work it from both angles and keep these in mind when I’m looking at new projects, opportunities, investments, and everyday purchases.

Nick Loper (Side Hustle Nation)

Figure out what really matters to you

My best personal finance tip is to figure out what REALLY matters to you. If you want your money to work on your behalf, and if you want to stop throwing your money away on things that you think are merely “nice to have,” you need to know what matters to YOU. The best thing you can do is honestly evaluate what you truly care about, and decide what you want from life. Forget about what you “should” do, according to others, and don’t be swayed by what the neighbors have. Instead, identify your own core values. Once you’ve done that, you can put together a financial plan and develop good money habits that will put you on the path to where your spending, your saving, your priorities, and the way you live your life all line up.

Miranda (Planting Money Seeds)

Make a financial decision

Personal finance starts with how you want your life to look like today and in the future. First, make the decision that you want a life free of money worries. Second, ask yourself what you’re willing to give up or postpone to make that happen. After you’ve done your mental money work, take action.

Here’s the simplest tip to make your money life as smooth as possible- take 10 to 15 percent of your salary and invest it every month in a Roth IRA or workplace 401(k). Invest that money in stock and bond index funds such as the Vanguard All World Index Fund and a Total Bond Index Fund. Over your working life, you’ll create enough wealth to live just as well in retirement.

Barbara (Barbara Friedberg Personal Finance)

Move to a debit card or cash for all transactions

For those struggling with credit card debt and spending more than they make, I’d suggest moving to a debit card (or cash) for all transactions. When a transaction is completed at the checkout register a debit card immediately removes the funds from a person’s bank account. In that way it serves as a restrictor plate on your spending. In other words, it slows a person down by making them focus on and analyze every transaction as it relates to their overall monthly bank balance and personal budget. When my wife and I did this years ago it dramatically decreased our spending and our savings rate skyrocketed. It ended up being the #1 everyday practice that helped us move forward with our finances.

Brian Fourman (Luke1428)

Stay invested and keep putting money into that investment

When it comes to investing, all you need to do are two things: stay invested and keep putting money into that investment. It doesn’t matter if you can invest $10 or $10,000 a month, just keep putting money into an investment on a regular basis. This will allow you to take advantage of compounding. In the beginning, it won’t add up to much (or seem like much is happening) but over time, you will see a huge difference. This is why you need to stay invested. You can’t jump around all of the time. Pick a few mutual funds/ETFs and hold them for decades. Learn to ignore the short-term and focus on the long-term. Over time, you will be amazed at how your money has grown.

Jon Dulin (Money Smart Guides)

Be money conscious

Our favorite finance tip is “Be #MoneyConscious”. What does that mean? Be money conscious essentially means truly understanding your financial situation and the financial world around you and their impact on your personal finances. For example, people too often go through life not knowing their true take-home pay or their true cost of living. They fly blind, then don’t know why they are in the financial position they are. Most people don’t know the cost of inflation and its impact on their income and expenses and don’t adjust their finances accordingly. Many don’t know why or when the cost of gas fluctuates and don’t adjust their finances accordingly. None of this is rocket science, but it does require a bit of engagement.

John (Debt Free Guys)

Track your Spending

My favorite personal finance tip would have to be track your spending – all of it! My wife and I have been tracking our spending together for the last couple of years. We have found that the simple act of tracking all the expenses that you have, can lead you to start evaluating each and every purchase to decide if you really need it, or not. I also enjoy doing it as a team with my wife, as this helps us to keep each other honest as well having someone to help you stay motivated.

Glen (Monster Piggy Bank)

2 comments… add one
  • JB January 8, 2015, 2:29 pm

    My two favorites are Just Start and Stay invested and keep putting money into that investment. These two were the hardest for me to do. I read roughly 25 books before I actually started putting into a savings account. I use my current job to help with my stock investing. So far in the last 3 years I have been able to sock away 35% more than the 10 previous years.

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