By Brett Gottlieb
Everyone has their own definition of success, especially when it comes to finances. For example, Warren Buffet says, “I measure success by how many people love me,” but if you ask Jeff Bezos, he says to be successful, “You must create more than you consume.” While there is no one-size-fits-all version of financial success, there are certain core behaviors and habits that will help you get there. In this article, we’ll explore the top 6 habits to keep in mind if you are trying to achieve financial success.
One of the best habits to build is financial confidence. Many people define financial confidence by how much money you have (e.g., having money gives you financial confidence). But it’s actually the opposite. Feeling confident in your ability to save money, build wealth, and make wise financial decisions is what brings financial confidence (and ultimately financial success), not the other way around.
Making the conscious mindset shift from one of cynicism and doubt to one of determination and confidence can make a huge difference in your ability to achieve your goals. In fact, some research suggests that a positive outlook on your own ability to accomplish something makes you more likely to actually accomplish it.
Don’t be afraid to dream big financially. You have the power to achieve your goals by proactively planning, dreaming, and strategizing. Think of your most lofty financial goal and break it down into smaller subsets. Does it sound impossible to save $100,000 in five years? Think of saving $20,000 every year instead. It’s easy to get discouraged when it feels that substantial progress is so far away. So, try acknowledging and celebrating small milestones along the way. This can help you stay motivated to keep working toward your goals.
Another great way to achieve financial success is through improving your financial literacy. It sounds cliche, but there is a reason the saying “Knowledge is power” is so commonly quoted. As with any topic, the more you know about finance, the more likely you are to make wise financial decisions. Sure, you can hire financial professionals to advise you along the way (see point #6), but nothing beats having a sense of agency over your own finances. You can rely on professionals, but you should also rely on yourself to grow your financial understanding and improve your financial literacy.
Reading books by financially successful people, listening to podcasts, reading magazines like The Economist and Kiplinger’s, or taking a financial education course are just a few ways to take your financial future into your own hands and improve your chances of achieving financial success.
You’ve probably heard it said that wealthy people avoid debt like the plague. Financially successful people live by this concept, understanding that credit should be used sparingly and not as a way to live beyond your means.
Credit can be a useful financial tool when purchasing large assets that will appreciate and bring value down the line (like a house), but it can be a slippery slope if used for everyday expenses or things you don’t need. Avoid overburdening your finances with credit card debt, and if you do use credit, make sure the balance is paid off every month. Revolving credit card debt is the quickest way to rack up interest charges and fees that can take years to pay off, which makes it exponentially harder for you to achieve true financial success.
Try shopping without your credit cards and planning ahead for large purchases instead. Minimizing the amount you have to borrow and creating a repayment plan are two ways to avoid the trap of everyday debt.
While you do want to follow the good financial habits of successful people, you don’t want to get caught up in thinking that your life needs to look exactly like theirs. This is especially true when you are working toward a certain lifestyle. You won’t be able to afford that lifestyle right away, so don’t feel pressure to keep up with the Joneses.
In today’s social-media-driven age, it can be tempting to compare yourself to your peers, feeling pressure to surround yourself with nice furniture, designer clothes, expensive cars, grand vacations, and the latest technology. But these items will only set you back in your quest for financial success, especially if they were funded with everyday credit (see point #3).
Financial success is often built from doing the things that other people don’t want to do: tracking expenses, minimizing your spending, saving and investing religiously, etc. These small habits, when done consistently over time, will generate compounding growth and provide the framework you need for financial success.
There are many ways a financial plan can be derailed. Whether this comes in the form of investment risk (hello, market volatility!), health risk, auto, liability, or homeowner risk, properly managing these potential obstacles is one of the most important ways to protect your accumulated wealth and build financial success. You can have a sizable amount saved, but it can be wiped out in an instant if you get sick, get in an accident, or experience any number of financial curveballs life may throw.
The good news is that though there are seemingly endless risks out there, many of them can be mitigated through proper insurance and estate planning. Get in the habit of regularly checking your insurance coverage amounts to ensure they’re adequate enough to protect what you’ve already built. Consider an estate plan to protect your wealth in the event of incapacity or death, and don’t forget that making sure you are adequately covered now will save you time, money, and energy in the future.
Though many of these points mention the importance of building your own financial confidence and literacy, working with a financial professional is also a potentially great way to achieve financial success. Not only are financial advisors a good resource for additional financial education, they can also help you stay on track and hold you accountable to the goals you want to achieve.
Advisors have access to industry tools, technology, and continuing education that could make tracking, implementing, and projecting the overall state of your financial plan much easier and much more accurate than if you were to do it completely by yourself. Consider working with an advisor you trust to help maximize your potential to achieve financial success.
Are you ready to take the next step in your journey toward financial success? To learn more about how Comprehensive Advisor can help you achieve financial confidence through these habits and more, email us at info@ComprehensiveAdvisor.com or call (760) 813-2125.
About Our Advisors
Brett Gottlieb is the founder of Comprehensive Advisor and a financial advisor with nearly two decades of industry experience. He graduated from California State University-Chico with two bachelor’s degrees in Business Administration and Economics. Brett is Life Insurance licensed in several states. He is passionate about guiding his clients on retirement income planning, helping each client pursue their specific retirement goals and defending the assets his clients have worked so hard to achieve. Brett is a California native and currently resides in San Elijo Hills with his beautiful wife and three children.
With a combined experience of over three decades in the financial services industry, our advisors hail from some of the largest independent broker/dealers and banking institutions in the country. They have dedicated their professional careers to creating personalized financial solutions for individuals and families who seek successful retirement planning and currently offer investment advisory services through AE Wealth Management, LLC. Our advisors take a common-sense approach to the planning process and work with clients to create a retirement road map to help ensure their assets are protected and they receive the income needed to enjoy their future. Based in Carlsbad, California, they work with clients throughout San Diego County and beyond. Learn more by connecting with Brett on LinkedIn or email them at info@ComprehensiveAdvisor.com.
Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Comprehensive Advisor are not affiliated companies. C.A. Financial & Insurance Services, CA Ins. Lic. #6000262. This material is intended to provide general information and is believed to be reliable, but accuracy and completeness cannot be guaranteed. Neither the firm nor its representatives may give tax or legal advice. Investing involves risk, including the potential loss of principal. Any references to protection benefits, safety, security, lifetime income, etc. generally refer to fixed insurance products, never securities or investment products. Insurance and annuity product guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company.1311252 – 4/22
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