There are tons of articles about money-saving tips. These aren’t just any ordinary tips. These are the 40 financial lessons that I’ve learned through experience. I’ve faced many financial challenges I’ve also managed to achieved financial success.
How I got there is a long story. It includes all my bad decisions in my 20s and counterbalancing those until my 40s. Here are some of the most important lessons that I’ve learned so that you don’t have to learn the hard way.
Lesson #1: Start Saving Early and You’ll Be Glad You Did
Save as much of your income as possible. Keep your expenses low. Avoid debt like the plague. Make more money, save more money and spend less money every year that you work from age 21 to retirement at 65.
Lesson #2: Set Aside Money Automatically
If you want to save enough for retirement, make savings automatic. When money is taken out of each paycheck before it goes into your checking account, saving becomes a habit that’s hard to break.
Lesson #3: A Higher Salary Doesn’t Always Lead to More Security
Having a higher salary doesn’t always mean more security. If you’re not careful, what should be your safety net could turn into the thing that leaves you in financial ruin if an emergency strikes.
Lesson #4: Capitalise on the Best Asset You Have
The best asset you have is YOU! Don’t be afraid to use your human capital as leverage for a better deal in life, work, and finance.
Lesson #5: Some Financial Advisors Are Just Trying to Make a Buck & Don’t Know What They’re Doing
Be sure to do your research, and find out if the person is truly qualified for the job before you entrust them with your money or future financial security.
Lesson #6: The Best Way to Solve Your Money Problems Is by Managing Your Money Better
It doesn’t matter how much money you have, if it’s managed poorly, as a result of your bad decision-making; you will still end up with the same problems.
Lesson #7: Money Management Is at the Centre of Your Financial Success
It’s important to know where your money goes and how it gets spent. Once you figure it out, allocate the funds accordingly in order to get the most benefits for what you are spending.
Lesson #8: You Don’t Need to Have a Lot of Money in Order for Your Assets to Become Significant
Having more money doesn’t mean you will have higher assets. You could actually end up with a negative net worth if your expenses are greater than your income.
Lesson #9: Passive Income Is Something That Takes Some Time to Make
Passive income is a great way to make more money on the side, but it usually takes time, money (or both) to create.
Lesson #10: Credit Cards Are Great – Use Them Wisely
In the right hands, credit cards can be a great thing. However, they are dangerous in the wrong ones. If you have debt or financial troubles, please talk to your bank for help.
Lesson #11: Things Can Change in a Heartbeat so Be Prepared
You may have it all figured out and be on the right track but then life happens. It’s important to stay flexible and adaptable to your surroundings.
Lesson #12: Never Spend More Than 100% of Your Salary
You always want to save money when times are good because you never know what will happen in the future. You may not need to save 50% of your income, but you should never spend more than 100%. If there’s something you want but can’t afford, put it on hold and buy it when the time is right.
Lesson #13: Every Penny Spent Is Just as Important As Every Penny Earned
If you focus solely on cutting expenses, but fail to also increase your income, then you’ll not be able to make the progress that’s necessary.
Lesson #14: Prioritize – It’s the Only Way to Get Things Done
Make sure to prioritize your personal financial needs first. Money should be spent on the things you love in life, but it’s always important that you have enough of it first to feel secure and successful!
Lesson #15: Your Net Worth Is What Really Matters
Income is important, of course. But if you want to be financially secure for the long haul, focus on building your net worth.
Lesson #16: Invest in Yourself Because You’re Worth It
The easiest way to make more money is to invest in yourself. Your education, your skills and your attitude are the most valuable assets you can have at work. Investing in them will pay off big time over a lifetime of good jobs and promotions.
Lesson #17: Investment Fees Can Have a Huge Impact in the Long Run
Just a few percentage points in fees can cost you tens of thousands over the years. Pay attention to what’s happening with your investments, and make sure that you’re getting the best deal possible.
Lesson #18: Making Money Is Hard but Investing Doesn’t Have to Be
The best way to get started is by putting away a little bit of money at regular intervals. You’ll thank yourself later.
Lesson #19: Instead of Working to Make Money You Should Start Making Your Money Work for You
If you want to have more money, start working on growing the value of what you already have.
Lesson #20: A Good Accountant Is Worth the Expense Because a Bad One Will Cost You a Lot More
Whether you’re starting a business, looking for ways to grow your assets or reduce taxes, an accountant can help. The cost is worth the benefits.
Lesson #21: What’s Best on Paper Isn’t Always What’s Right in Reality
We all want to be successful, but the best measure of success isn’t always what’s on paper. Every person has their own definition.
Lesson #22: Time Is More Valuable Than Money You Can Always Earn More Cash but You’ll Never Get Back Your Time
There are lots of things that money can buy – time is one thing it can’t. Time is limited. Make sure to use your time wisely and spend it on the things you really care about.
Lesson #23: Life’s a Journey Make It Yours
It’s up to you to decide what’s worth your time. Remember, you can’t buy it back so be sure to use it wisely.
Lesson #24: Money Isn’t Worth Your Life
It’s important to find what you love and choose a career that’ll make time fly by so you can enjoy the things money can’t buy.
Lesson #25: If You Want to Build Wealth, Don’t Trade Your Time for Money
There are a lot of ways to make money, but trading your time for it is not the best way. You need to find out how you can leverage your life and other resources in order to create wealth.
Lesson #26: If You Do What Everyone Else Does, You End Up in the Same Place as Everyone Else
There are a lot of different strategies when it comes to finance and investing, but don’t be afraid to make your own decisions.
Lesson #27: Knowing Is the First Step; Doing Is the Second
Knowledge is power, but knowledge isn’t worth anything if you don’t put it into action.
Lesson #28: Scaling up Doesn’t Always Mean Less Stress
Too often, people believe that more money will lead to less stress. But the truth is when you have more of anything, it usually leads to greater problems.
Lesson #29: Listen to Your Gut & Believe in Yourself
We all get this nagging feeling when something is wrong or feels off in a situation. You should always go ahead and trust that feeling.
Lesson #30: Your Strengths Are What Make You Unique So Use Them
We all have different strengths and weaknesses. Rather than focusing on what you’re not good at, focus instead on developing your strengths. This is where the real growth happens in most people’s lives.
Lesson #31: It’s Ok to Enjoy Your Money You’ve Worked Hard, You Deserve It
It’s OK to enjoy your money, but don’t neglect the future. Remember that enjoying your life now is fine because you’ll never be able to go back and do it all over again.
Lesson #32: One-Size-Fits-All Doesn’t Fit Everyone
The best financial decisions are often tailored specifically for each individual. Regardless of what you decide on, it’s always a good idea to discuss your decision with a trusted advisor or friend.
Lesson #33: Don’t Spend to Impress Rather Live Within Your Means
It’s not worth it to buy things you can’t afford or incur debt just for the sake of impressing someone. It will only cause more problems in the long run.
Lesson #34: There’s an Opportunity for Everybody to Succeed
No matter who you are or where you come from, it’s possible to make the right decisions and end up in a good place. All it takes is one positive step at a time.
Lesson #35: A Goal Without a Plan Is Just a Wish
It’s important to have a plan for your money, even if you don’t know exactly what that is. It’s always better than having no idea at all.
Lesson #36: The Best Way to Achieve Something Is Through Small Steps
If you want to be rich someday, start by saving just a little bit of your money each day. You don’t need the whole thing right now or all at once.
Lesson #37: It’s Not Enough to Have Good Intentions You Need to Act on Them if You Want to Achieve Your Goals
It’s important to have good intentions when you start a plan, but intention alone isn’t enough. You need to execute your plan and follow through on it.
Lesson #38: Finance Is All About Knowledge. The More You Know the Better off You’ll Be
The more you know about financial matters, the better. Financial literacy is a huge advantage in life and can be one of your greatest assets if mastered.
Lesson #39: There’s Always a New Lesson to Learn
It’s never too late to learn more about personal finance, and it doesn’t have to be overwhelming.
Lesson #40: Forget Everything You’ve Been Told About Money
There are plenty of misconceptions about money, and you should keep an open mind.
How Important Is Investing?
Investing is not the only way to make money. Investing can be a great way to grow your wealth and improve your position in life, but remember that it’s up to you whether or not an investment will be worth your time.
What Is the Best Way to Save My Money?
The best way to save money is by having a clear idea of your goals and then evaluating the various options for saving. Remember, you can’t buy back time so be sure to use it wisely
This is a list of 40 finance-related life lessons that I’ve learned in my forty years on this earth. These are not just financial tips, but rather they are ways to make your life better and more fulfilling. Some of these may be common sense, while others will likely stretch you out of your comfort zone.