6 Powerful Money Habits to Set You Up for Success

These 6 money habits will transform your finances and set you up for success in all your financial goals!

This post may contain affiliate links. Read my full disclosure policy here.

First off, I want to give a big welcome to Natalie from NatalieBacon.com!

When Natalie approached me about guest posting on KalynBrooke.com, I absolutely fell in love with her thoughts on successful money habits. I’m a big proponent of small changes leading to longterm results, and am so excited to share her insights with you today.

Trust me, you will want to begin practicing these 6 simple habits right away!

These 6 powerful money habits go a long way in building a strong financial foundation, and will give you dramatic results one simple step at a time!

Simple daily disciplines – little productive actions, repeated consistently over time – add up to the difference between failure and success.
– Jeff Olson, The Slight Edge

On my self-improvement journey, I’ve learned one really important thing – the power of habits. Whether it relates to health, relationships, or finances, the power of habits is unprecedented. This is great news for you! Instead of attempting something grand, you can instead focus on small, daily actions that will have dramatic results over time.

You don’t just want to have any old habit, however. You need to make sure that your habits are positive, and that they move you toward success. You don’t want to be in the habit of doing something if it’s not taking you toward a vision or goal. But once you decide which habits to adopt, you can implement them, and little by little, you’ll change your life over time.

In terms of finance, there are numerous ways to go about building a strong financial foundation. Here, I’m talking about the best habits I think you can be in to set yourself up for financial success.

6 Money Habits to Set You Up for Success

1. Pay yourself first

Set up your finances so that as soon as you’re paid, money is automatically moved into a savings account. One option is to have an amount from your paycheck directly deposited into a separate bank account. Another option is to set up an automatic transfer on payday from your checking account to a savings account.

Here’s why paying yourself first is important: If you pay yourself first, you’ll still be broke by your next paycheck, but this way you’ll have savings. What do I mean by this? That you tend to spend what you let yourself spend. If you are in the habit of paying yourself every pay period, you’ll treat it as an expense and build wealth little by little over time.

2. Avoid debt

If you have debt, create a plan to get out of it.

Once you have your get-out-of-debt plan, implement it in the form of a habit. Don’t wait until the end of the year for a bonus. Instead, start chipping away at your debt regularly (daily, weekly, or every pay period). If you constantly are chipping away at your debt, you’ll begin to see your debt go down, which is exciting. This excitement will give you momentum to keep going and get out of debt fast.

Once you’re out of debt, continue in the habit of staying out of debt.

3. Check in on your finances regularly

Set up a time where you review your finances regularly. Put it on your calendar as a recurring event. This way, you’ll know that’s the time where you review your budget, income, spending, etc. It’s the time where you make sure you’re being intentional with your money and in control of your financial foundation.

4. Use cash / debit (avoid carrying a credit card balance – ever)

Instead of using your credit card, get in the habit of using cash or your debit card. Being in the habit of using only the money that you have will change your mindset to one that only pays for things when you have the money in the bank. You won’t even have the option of using money that you don’t have if you pay with cash or a debit card. Being in the habit of only buying things when you have the money will put you on track for financial success.

I’ve never had a credit card – ever.

If you do choose to use credit cards, make sure you’re in the habit of paying off your bill every single month. It’s never good to carry a credit card balance. (Carrying a balance regularly would be an example of a bad financial habit.)

5. Say “no” to yourself at least once a day (to remove any sense of entitlement you have)

Get in the habit of saying “no” to yourself once every day.

By saying “no” to yourself, you’ll remove any sense of entitlement (which usually shows up as a justification for buying something because you “deserve” it). If you’re in the habit of saying “no” to yourself, you will be less tempted to overspend and buy things you can’t afford.

6. Read something financial once a week

No one will ever care more about your finances than you do. So, it’s your responsibility to know what’s going on, even if you do hire a financial professional. If you simply devote one hour of reading the financial news or a finance book every week, you’ll start learning more and more. Over time, you’ll be amazed at how much you know.

Of course, you can read more than once a week, but starting here may be just enough to get you going. There is power in knowing and that’s exactly what this habit is about. Knowing how to manage your own money.

A Final Note!

If you can do these 6 habits, you can change your life.

Remember, it’s the little things you do daily over time that make the difference between failure and success. Instead of letting your finances overwhelm you, try implementing these 6 habits first. You’ll be amazed at the success that comes from doing small things on a daily basis.

In his New York Times best selling book, Secrets of the Millionaire Mind, T. Harv Eker says it best when he says “Wealthy people are not any smarter than poor people; they just have different and more supportive money habits.”

Have these 6 habits down pat? Check out this amazing resource page that has more than 60 tips and ideas about how to manage money better.

What Money Habits Do You Still Need to Work on?

Natalie Bacon | Finance Girl

Natalie Bacon is the author of NatalieBacon.com where she blogs about finance and intentional living for young, professional women. She’s an attorney by day and a personal finance freelance writer and blogger by night.

Disclosure: Some of the links in the post above are affiliate links. This means if you click on the link and purchase the item, I will receive an affiliate commission. Regardless, I only recommend products or services I use personally and believe will add value to my readers. Read my full disclosure policy here.

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  1. This article is a good read, so informative! When there is a scarcity of health support, learning how crucial it is to purchase a health care plan and knowing its advantage when you avail yourself one. I hope many people can see this post as this can give them a lot of information.I also want to share that Money Habitudes is used by financial professionals, coaches, therapists, educators and more to engage people in a topic that is often difficult to discuss, leading to more relevant, effective and individualized strategies.

  2. I think it is irresponsible to counsel to avoid credit cards altogether. Credit cards are an important way to build and strengthen credit history. The key is to use credit cards responsibly- preferably by paying the entire balance off each month. Secondly, using a debit card for purchases is not safe. Debit cards do not have the same security features built in as credit cards. They should only be used at reputable ATMs. Learning to use credit wisely is the most important thing.

  3. My key takeway is to pay myself first. This is one habit I am trying to cultivate. Like you truly said, we will still be broke before the next pay check but at least I can boast of having some savings in my account, however small. That feeling is amazing. Great tips thanks for sharing.

    1. I hope you are able to see progress, Esther! It is probably one of the hardest habits to develop because it feels so backwards to how we think budgets are supposed to work.

  4. I agree with all the tips here except #4 about not having a credit card. Me and my boyfriend make pretty good money and we were ready to buy a house. I never had a credit card, student loans, car loans etc. I thought having zero debt would help our chances of qualifying for a home loan. Boy was I wrong. The lender said its virtually impossible to buy a house with no credit history. Since then I have gotten a credit card and have researched what it takes to quickly build credit as we don’t want to wait to buy a house. All my research has pointed to having a small balance on the card is what builds your credit. If you ever plan on buying a house I highly recommend getting a credit card and using it as if it is your debit card. Don’t be dumb and buy things you cant afford. Only use it to buy things that are already in your budget such as gas, groceries, etc.

  5. Using a debit card for anything but to get money from the ATM is a HUGE mistake! If your card info gets hacked they can clean out your checking account in minutes. Yes, you can dispute it, but that can take weeks, leaving you with an empty account in the meantime. If someone steals your credit card info they don’t have accesss to your whole paycheck. I opted for a secured credit card with a low limit and that is what I use for all purchases. I pay it off every week (or sooner). For those living paycheck to paycheck please protect your money!

  6. I love simple strategies that can really make a big impact, especially when it comes to finances! The one about saying ‘no’ daily is something that is almost never talked about, but that mental shift from entitlement to contentment with what we have is so important to achieving almost any financial goal. Love it!

  7. Great post, I really appreciate financial info directed for a young female professional like myself 🙂
    One thing I don’t understand, though, is your no credit card rule. I was always told that credit cards were necessary because building your own credit is crucial for later in life.
    For example, how do you buy a house if you don’t have any credit? I don’t know much about finance, but using credit cards responsibly in order to build credit for large purchases later in life has always been a cardinal rule I’ve been told by everyone from high school teachers to professional financial advisers.
    I saw you mention credit unions to another commenter with a similar concern-how does this work? Is this a preferable alternative to building your own credit? What would you recommend to a responsible credit card user who is able to maintain a zero balance?

    1. Great question, Valerie! Personally, I have a no credit card rule because they are too tempting (I am a spender and like to shop). But if you use a credit card responsibly then I don’t see the problem. So, if that is you it sounds like you’re doing great. I will say that I do not think you ever need a credit card. I plan on buying everything with cash, including a car. The only time where I wouldn’t use cash is the example you gave, a mortgage. For that I know that you can get mortgage from banks that do ACTUAL underwriting (not just based on a credit score). Dave Ramsey’s website has a lot of resources to help people out with this. Basically, if you are good with money and have a lot of money, you should be approved for a mortgage more readily than someone who has a good credit score because that is just a reflection of how good you are with debt. So, you would look into different banks (and credit unions) who underwrite manually without relying on a credit score in order to get a mortgage if you don’t have a credit score. Personally, I have a great credit score but that is because I took out a lot of student loans and have been paying them back. But once they are paid off I do not plan on getting a credit card – they are just not for me.

  8. I would dissuade people from avoiding opening a credit card. If someone wants to obtain a car loan or home loan, having a credit history will make that possible. I’ve had a credit card since I was 16, never missed a payment and pay in full each month. I’m single and own my home.

  9. I’m a big fan of #5, saying ‘no’ to yourself. Often the biggest obstacle to achieving financial success is looking at you in the mirror. Saying ‘no’ when temptations pop up will helps me stick to my budget!

  10. These are all excellent tips! Trying to live by all of them, and I’m especially excited to get out and stay away from #2. Thanks for sharing 🙂

  11. I think credit cards depend on the person. If you are going to spend the same whether you are paying with a credit card or debit card, I say use a credit card. I’ve primarily used a credit card since I was 18 and I’ve enjoyed all the bonuses I’ve received from it.

    1. Definitely. Only you know yourself. I don’t think the perks are enough to persuade someone who will be tempted to spend more (which based on the numbers, is a lot of people). You really need to do what’s best for you and BE HONEST WITH YOURSELF and always avoid credit card DEBT (that is to say, even if you use a credit card, never carry a balance). Credit cards should not be used as widely and as often as they are (in general) based on the average debt held by people who use credit cards. People think they have to use a credit card instead of getting in the habit of using cash, especially when they have a propensity to spend. The financially savvy, educated person who uses a credit card and pays it off monthly is a lot different than the average person. No matter how good the perks are, if you don’t pay off your balance every month, it’s not worth it. Obviously, you’re not one of these people (which is why they work for you)!

  12. I’m another one that is going to disagree with you about the credit cards. I avoided them all my life but now find myself in a nasty divorce and may not be able to get the marital home put in my name because I don’t have any credit due to avoiding it all my life. I thought I was being financially smart by staying out of debt but now that very thinking may put me out of my home!

    1. I am so sorry you’re going through this right now! While every situation is different, you can’t plan for everything. I’m sure you thought you wouldn’t be in this situation at all. And hindsight is 20 20. All you can do is move forward (and it’s good you’re moving forward without debt – that’s a huge win)! Personally, I use cash and think that’s the best way. Specifically, like I said in the comment above, most people don’t have the will power to avoid getting into debt with credit cards (they don’t pay it off monthly and spend a lot more than if they would have used cash). So, that’s what I live by. Hopefully, you’re able to put a lot of cash down and go through a credit union / local bank (sometimes easier). Also, I recommend listening to Dave Ramsey’s podcast (free) daily because he touches on a lot of this stuff and may provide more information than what I can in one comment. All the best of luck to you!

  13. I think that these are great tips, but I do disagree about using credit cards. If you use them responsibly (buy only what you would if you were using cash and paying the balance in full every month), they can be advantageous. You establish credit (necessary if you don’t have the cash to pay for your house in full) and several cards have rebate programs and points which end up saving you more money than if you were to use cash. However, if someone is struggling with impulse purchases or overspending, I’d agree with you.

    1. There are definitely people out there who do use and have always have used credit cards successfully (and by that I mean paying them off in full every month). But generally, people are more tempted (and spend more) when they use credit cards (based on my research and the statistics available). And while no one is getting rich from perks / points, they can definitely save yourself a lot of trouble by avoiding credit cards. Of course, there are always exceptions to any rule. And like you said, if you’re really good with credit cards, they can work for you. But for a lot of people, that’s just not the case. Thanks for your input!

  14. I’m not sure how I happened upon this blog today, but I was delighted to see that these rules have been a way of life for me since my 30s. I am now 61 and unexpectedly unemployed, 3 years prior to my planned date. Transitioning from saving to spending has been a challenge but I know now that I CAN retire ..or I can look for another job (maybe doing something I like!). Options! I will be ok since I’ve been saving for 30+ years, but would be more comfortable if I would have started earlier. Start early! Develop the habits, even if you feel the amount you save is not much. …just keep nudging the amount up. Keep learning.

    1. Thank you for sharing your story, Mea! I am so glad to hear that you’ve been financially savvy for so many years. And it has paid you back in dividends – that is so wonderful! Good luck to you!

  15. I love number 5. It’s hard to get away from the I deserve this attitude.. will work on that. Great information.
    I do use a credit card regularly to build my credit which hadn’t been so great. Balance is paid each month!

    1. Nice work on always paying your balance – that’s definitely a must! Also, I think the saying no to yourself is such a great tool that is easy to use once you make it a habit. Then you begin to only buy things when you can afford them, not when you “deserve” them.

  16. Great tips Natalie, definitely going in my weekly best personal finance advice post on Thursdays.

    Would have to argue with avoiding debt completely though. You don’t need to avoid debt completely to reach your financial goals. In fact, debt can be one of your most powerful tools to get there but you have to use it responsibly. Avoid high-rate debt and don’t overdo the credit card spending.

    1. Agree to disagree! 🙂 I will say that for professional investors, specifically with real estate this could be good, but for everyone else, it’s really unlikely you’re going to use debt in a way that helps you reach your financial goals because of risk. Anything can happen at anytime and if you avoid debt you minimize your risk. But, that said, I like the discussion and really appreciate different opinions on it, so thank you for sharing!!

    2. I agree Joseph. Using credit cards can be good sometimes. We use an American Airlines credit card for all business expenses and a Southwest credit card for all monthly household expenses. Then we pay them off in full every month. We’ve accumulated mega travel points. We never pay cash for flights AND we travel priority and first class always. If you are not disciplined though, credit cards should be taboo. The balance must be paid off every month. Period.

  17. Although I do use credit cards from time to time, if income is not flowing very well like it is right now I always go back to cash/debit card only spending. It’s just too much of a slippery slope to use a credit card then find you don’t have enough cash to pay the card back at the end of the month.

    1. That’s a good rule of thumb, Tonya! It seems like you know when you would be at your weakest / most tempted and have a plan in place to prevent that from happening, which is great.

  18. Great tips Natalie! I am a big fan of #1 and get my clients to focus on that first and foremost. It’s amazing how much better their finances get and their mental health when they see their assets start to grow. Most people think of savings as an after thought, when it should really be step one in the whole process.

    1. Isn’t it funny how the mind works sometimes? Just be seeing the savings grow, you really do get momentum and encouragement to keep going and even reach further than you first thought you would.

  19. These are great tips. The earlier and more consistent you get with your habits the earlier you really start to build wealth. I was saving and staying out of debt, but not really doing much with my money. Fear or ignorance of investing is not a good excuse. You should continue to live debt free, but study finance and investing. The earlier you make your money work for you the better you will be off and live without regrets later on wishing you had started earlier in life!

    1. Yes! Great point, Lance. I think studying finance and investing can do a lot to calm fears of the unknown when it comes to building wealth. And with researching and studying, you have nothing to lose and knowledge to gain.

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