5 Healthy Money Habits

Money is a necessary tool for every lifestyle, and we all have financial goals we want to achieve. While you may have ambitious money goals, the key to reaching them is building a collection of smaller everyday habits. Starting small will help improve your financial situation.

Last year, I had a small goal to save every day. To do that, I started automating my saving. I had a goal to save 10 per cent of my income which I got used to, and when I realized I could attain more, I increase to 15% and now the rest is history. I am happy with how I started and how far I have gotten because I started small to imbibe money habits.  

With my experience, here’s a list of five healthy money habits to build that can drastically benefit your future financial health.

  1. Set Financial Goals and Review Them Often

Setting short-term, mid-term, and long-term financial goals is an important step toward becoming financially secure. If you aren’t working toward anything specific, you’re likely to spend more than you should.

Goals are an opportunity for you to decide who you want to be and what you want your life to look like in the future. Your goals can be to go back to school to further your education, buy a house, pay off debt, etc. My goal was to have funds that could guarantee my security no matter way comes my way. Whatever it is—we all have different priorities—it’s important to find your inspiration and the “why” behind your goals.

At intervals, I went back to the drawing board, thought through my priorities, and locate areas I can adjust to meet my goals. Today, set that special money goal and review them at intervals. 

2. Automate Your Savings

After I had my goal in mind, the next way I could achieve this was to automate my savings. This was a strategic move for me so as not to fail in meeting my goal. I always advise using the “Set it and Forget it” approach, which means automating your savings.

Setting up automatic transfers is one of the easiest ways to save. To make headway on your goals, auto-transfer a few Naira into your savings account each week. For instance, if you’re trying to save N1,000 in six months for a new Laptop, automatically transfer N42 a week into your savings account.

3. Plan your Purchases

Some of us are so addicted to acquiring lots of items that eventually are not really needed. To imbibe a good money habit, you need to plan your purchases instead of making a quick run to the stores to buy a few items here and there. Make a list of exactly what you want to buy and how much you’re going to spend. By having a list and sticking to it, you’ll be better at avoiding impulse buys or picking up items you don’t really need.

The same goes for things you buy online. Figure out what you really need, how much you can afford to spend, and wait at least a few days before making the purchase. If it’s not an essential item, try to wait 30 days before adding it to your cart.

We often operate under the assumption that these one-off expenses are “surprises” or throw off a normal month—but in reality, they are wholly predictable. A little intentionality goes a long way in smoothing out your spending and planning for the future

4. Pay yourself First 

If you want to make sure you’re not overspending, create a budget. But if you want to grow your savings, pay yourself first. Paying yourself means putting your money toward savings first when you get your paycheck, then living off the rest.

One major mistake is to avoid paying yourself after your bills and expenses are taken care of because you run into the risk of not saving enough to hit your big-picture goals.

One way I pay myself is to automate my savings on FundBae. This will not just help to save but also earn get extra funds to sort other money priorities.

5: Spend for Your Health

Everything we can do today to prioritize our health is an investment in ourselves. Our wellbeing — physical, mental, emotional—is worth investing in. Like the popular saying “Health is Wealth”, make sure you are doing things that improve your health to enjoy your finances.

Maybe your habits look slightly different from my list, but one thing I know for sure: if you focus on those small, bite-sized healthy money habits today, you’ll completely transform your tomorrow.