–
Jason Howell
–
Wealthy people share some habits that help them grow their money, says financial planner Jason Howell.
They invest in themselves and keep their daily routines as simple as possible so they can focus on their priorities.
They avoid excessive lifestyle and save any extra money they get from raises instead of spending it.
–
The path to success looks different for everyone. However, there are a few key things most wealthy people do with their wealth to help it grow over time. It’s not a get-rich-quick scheme, it’s a slow and steady process that takes time and dedication. Financial planner Jason Howell is President of Jason Howell Company and author of the book Joy of Financial Planning. In his book, he reveals some of the most important money-related habits that his wealthiest clients have in common.
1. You invest in yourself
The financial planner works with many high net worth individuals on a daily basis. He says that those who have built their fortunes from the ground up make it a point to continue learning every day. The more skills you have, the higher your market value. “You have to learn how to make money,” says Howell. It is not important whether you continue your education through a degree or a book. You will be able to apply your newly learned knowledge – whether in your current job, in a future one you wish for or in your part-time job.
The internet is full of opportunities you can use to improve your skills. Howell recommends trying online tutorials like Udemy. Udemy is a course provider that covers everything from computer programming to marketing. The platform is a great place to learn new digital skills that are valued in today’s market.
2. You do not lead an inflationary lifestyle
What you do with your money when you get a raise can make a big difference to your wealth in the long run. You can set aside more money for retirement and other goals if you save the extra money from raises. Allowing your spending to keep up with your paycheck — a phenomenon known as “lifestyle inflation” — can cost you dearly.
Howell says, “When people get promoted and their income increases, many tend to increase their spending. You buy a new car or treat yourself to a new wardrobe. Some also get rid of their roommate. This is where people make questionable judgments. Those are decisions you don’t have to make.”
Instead, he recommends investing the extra income. Investments are suitable in various types of investments whose dividends or compound interest can bring income. Tools like Betterment, a financial consulting firm specializing in cash management, can get you started if you’re unfamiliar with them. The earlier you start, the more opportunities you have to increase your wealth.
3. They keep their daily routines simple and straightforward
Mark Zuckerberg and Steve Jobs kept their wardrobes clean and simple — and there’s a reason. As your income level increases, so does your responsibility. As long as you keep daily routines simple, you can keep your mind free and not put yourself in danger of suffering from decision fatigue. Otherwise, you might make mistakes when making important decisions because you are mentally exhausted.
Simplifying your routine is especially important in the morning. Your morning routine sets the tone for your day and frees your mind for creativity. The less time you spend thinking about what to eat for breakfast, the more time you have for more important questions and ideas. This approach can be applied to many areas of your life — including an investment strategy. Some of the sophisticated investors put their money in simple, low-cost index funds, Howell says. They don’t check their accounts for months. This helps them avoid mistakes like buying the next good stock or selling when the market is up, the financial planner continues.
Decide what your priorities are and focus your energy on them. If you find yourself in a situation where you’re over-analyzing and not sure what to do, Howell recommends deferring the decision.
This article was translated from English by Julia Knopf. It was published in March 2020 and has been checked and updated. You read the original here.
–
