The personal finance habits of successful people

The personal finance habits of successful people

Imagine if where you are in your life today was a result of your habits, good or bad! The thing is that this statement must be about half true because about 40% of our daily activities are habits. We mostly run on autopilot! Do you remember working out how to put your shoes on today or remember how you reversed out of the driveway this morning? The answer should be no.

What if we could make our financial life run on auto pilot and remove ourselves from making as many bad decisions as possible?


When I was trying to eat healthy and exercise more, I didn’t become an ironman overnight. I’m still far from anything resembling a fit ninja warrior but I did start to change my habits. I went for the low hanging fruit as my first port of call. For me is was to not drink any soft drink. I weened myself off this and replaced with say, Coke Zero first, then sparkling mineral water, now I have a water filter in my house and I basically only drink water. Can we look at this example and think about something we can do with our personal finances today to start to turn a corner?

Our brains love routine and the path of least resistance for anything.

It’s important to get to know what habits are first. In the 90’s a team of people at MIT (Massachusetts Institute of Technology) worked out the neurological process that is at the core of every habit. This was a three-step process. Cue, Routine, Reward.

Cue: I’m stressed out

Routine:  Eat chocolate

Reward: Feels great and stress stops

That there is a habit loop. What if we could somehow change our personal finance habits to a cycle like this:

Cue: I get paid

Routine: Invest money

Reward: See my account growing & feel good about the future

We want our brain to crave things so the habit loop is triggered!

They say it takes at least 30 days to form a habit.

In my career of being a financial adviser I have seen under the hood of hundreds of client’s personal finances and consequently, the ones with good money habits have far more money than those who do not. Less debt, too! No brainer, hey! The thing is there is no correlation between how smart someone is and how much money they have. I have seen very smart high-income earners with little to no savings. This is because they have not put any habits in place when it comes to their personal finance.


I have also observed that their habits are more around their thought process and mindset rather than something physical. I always think it’s like learning how to control the most powerful asset you have: your mind.


Here are 6 personal finance habits of successful people

1. They keep away from consumer debt

The poor ask how much per month, the rich ask how much. This habit here may take a few months to crack! Removing yourself from the credit card and personal loan cycle will be the best thing you’ll ever do. This frees up your cash flow, allows you to be more considered and will slow you down for purchases. Paying cash for household goods and other items is the best habit to get yourself into for the long term! Paying off and staying out of consumer debt should be the first thing you do on your journey to successful habit land!

2. They automatically invest money into an investment or their super every single month

This habit is low hanging fruit. Can you start today? Can you set up a small amount each month to a savings account out of reach, your superannuation or an investment. Can you build this habit by asking a friend to join you with a savings plan to strengthen your savings muscle (habit!). Start small, set a goal and get that habit loop happening when you see your money increasing.

3. They have a money system set up that automates their spending accounts


This is also like automatic investing. Most successful people have their personal spending plan or budget nailed. It should take care of itself. For example, money going into a cash hub account and then a weekly amount going to a spending account, bills account, short term savings etc. This removes the human nature element and is also a very good habit to get into when it comes to your personal finances, particularly separating your daily spending into another account.

4. They are always listening or reading topics to keep themselves educated, encouraged and focused

Fiction is great for entertainment, but what can you learn for yourself? Successful people are in the habit of always working on personal development. Can you get in the habit of listening to an educational podcast on the way to work or perhaps read something to improve things in your life?

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5. They always have a goal that they are aiming for

That old saying that someone made up (that no one knows who): if you aim for nothing, you’ll hit it every time. It’s been my experience that successful people have goals and live to meet those goals. This is interesting considering the habit loop which I discussed previously. What are you aiming for? Can you also get an accountability partner to help each other work on this habit?

6. They are always thinking long term not short term

They say that the best time to plant a tree was 25 years ago, the next best time is today. Successful people only think about the future. They are in the habit of delaying gratification. The short-term gratification is won in the process of doing something long term. How can you change your mindset today? What can you do for the you of 10 years from now?

So what now?

The challenge is this: what is one thing can you start TODAY?

Make it small, make it a habit. Go easy on yourself and do one thing at time!


p.s. this is an article I wrote originally for your best interests.