Smart Money Habits

Smart Money Habits 

Whether you are a big corporation or a regular household, there are smarter money habits to put to work that will benefit you in the short and long run. 

To start off, one of the best money habits someone can have is something I have mentioned in my blog posts before, keep track of what you spend every day. When you write down your spending and then look at them at the end of the month, you will be amazed at the places you realized you could save your money. It can easily be forgotten where you are spending money when you just swipe a card, this way you can see as a whole where your money is going and where you can save money. 

Another change you can make for spending habits is to implement the 48 hour rule for purchases. This has happened to everybody, we buy something, then come to realize we don't need it and the purchase was a complete impulse by. The way to avoid these regretful purchases is to wait 48 hours before you decide if you really want it, that way you will come to realize if the item is really worth the money that is going to be spent on it. Using this will keep the wasteful purchases out and ensure you are only spending money when it is worth it. 

Along with tracking your spending and making better spending choices, another good thing to do is start saving small amounts of money. Sometimes, it will look as if the amount of money you need for an item, vacation, or anything else is insurmountable, but if you start by putting away small dollar amounts, it will add up and it will not be as big of a financial burden as you thought. (Feinstein)

When you are able to save money, the best thing to do with that money is invest it. Money won’t grow sitting, but if you invest it, the money will grow and you don’t have to do anything. One of the most powerful things in finance is compounding interest, and the earlier you can take advantage of it, the more you will make.  

For a business, it is also important to practice smart money habits, some are very much similar to personal finances. As a business, it is important to constantly be reviewing their finances. Doing this helps better understand the state of the business as a whole, meaning you can see if money is being made, whether clients are paying on time, and how much activity your business is experiencing. 

Everybody has to deal with taxes, but for a business, it is a good idea to set the money aside for taxes and keep it out of the income. This is a good idea because the money that the government takes won’t get confused with what is actually made, which means that the business won’t be scrambling to pay taxes and incur penalties for not paying on time. 

Successful businesses also make sure that they don’t have any deep long term debt, and if they do, they find ways to pay it off. Businesses take on short term debt to help grow the business and invest in new products, but when there is long term debt, it is important that they work to lower the debt and avoid higher charges and interest rates. (Baker)

I learned about these money habits by reading articles from professionals in the financial field, it was good to hear successful people talk about these habits and what works. This blog relates back to what I have been talking about with using apps  and managing cash flows. Both of these blog posts relate to this because many of these things I have talked about, like investing and tracking spending, can be used on apps from your smartphone. 

Creating good habits with your money is beneficial for people and business. Better habits lead to even more good habits, and the benefits that come financially are well worth it. It can lead to less stress, more secure finances, and long term security. For a business, good habits will keep money coming in, which can lead to growth and more success for the company. It may take a little more effort, but it is highly beneficial. 

Grant Williams

Baker, Matthew. “The 7 Financial Habits of the Most Successful Small Business Owners.” Entrepreneur, 5 May 2017, www.entrepreneur.com/article/293662. 

Feinstein, Ashley. “7 Smart Money Habits To Start Right Now.” Business Insider, Business Insider, 14 Jan. 2015, www.businessinsider.com/7-smart-money-habits-to-start-right-now-2015-1.