The 7 Simple Habits of Financially Successful People


Financial education is non-existent in American schools. I remember learning how to write a check and balance a checkbook in Home Ec, but there were no courses about mortgages, budgeting, taxes, or living within my means. Not at school, anyway.

My parents taught me about being frugal. There weren’t any overt lessons, just leading by example in their daily lives. They didn’t do anything extravagant — no big vacations, no fancy clothes, no new cars. In fact, my dad drove the same car throughout my entire childhood. He bought it brand new two years before I was born. I learned to drive on this vehicle, and it had something like 200,000 miles on it when it finally died.

With so little financial education readily available, it’s no surprise that few people know how to manage their finances. So how do some people kill it, while others struggle?

Here are 7 habits of financially successful people.

How to Purchase Real Estate With No (or Low) Money!

One of the biggest struggles that many new investors have is in coming up with the money to purchase their first real estate properties. Well, BiggerPockets can help with that too. The Book on Investing in Real Estate with No (and Low) Money Down can give you the tools you need to get started in real estate, even if you don’t have tons of cash lying around.

Click Here to Download

The 7 Simple Habits of Financially Successful People

1. They check their statements every month.

Unless you’re completely off the grid, you get statements from your various accounts every month. Whether available online or actual paper statements, you have access to a monthly accounting of what’s going on in your finances. How often do you check them?

My husband starts each day with a quick peek at the statements. Bank, credit cards, stock investments, etc. He tracks everything going into and out of each account, every single day. While this may seem excessive, he feels uncomfortable when he doesn’t do it.

He discovered our credit card number was stolen a few years ago when a weird charge showed up. We were able to shut down that card quickly, before it turned into a big problem.

Keeping tabs on your accounts doesn’t have to be a daily thing. Weekly or even monthly is fine — but many people just don’t even bother to ever check it.

When was the last time you checked your monthly statements?


2. They plan their estate.

Nobody likes to think about dying. Planning your estate can be a depressing task — which makes it extremely easy to put off. Repeatedly. Like, forever.

But without a will, you have no control over what happens to your things. Your house, your car, even custody of your children all becomes subject to the intestacy laws of your state, which may not bear any resemblance to your wishes.

Don’t let this happen to you. Make a will so that your assets go where you want them to go. Even a handwritten holographic will will preserve your intentions.

Include custody directions if you have children or animals. The best course of action is to have a conversation with the person you are giving custody to — you don’t want it to come as a surprise to them.

Be as specific as you want in your will. You earned this wealth. You helped it grow. Direct your heirs on how to handle your possessions, so your legacy can continue.

3. They create (and stick to) a budget.

Financially savvy people have a plan for their money. Dave Ramsey calls it “giving every dollar a name.” You make a plan for how you are going to spend your money each month, rather than just hoping you’ll have enough to pay all the bills.

Related: 6 Easy-to-Acquire Habits That Will Help You Build Wealth

But say the word “budget,” and people freak out — it sounds like a restriction. Look at your budget as a tool. You don’t have to give up everything simply because you make one. Instead, you are creating a blueprint for how you want to spend your money.

4. They live below their means.

Spending every dime that comes into your pocket is one of the best paths to financial ruin. Having no cushion doesn’t allow you to roll with the punches that may come along. Lose your job or have an unexpected bill, and it could take you months or even years to recover.

Living below your means allows you to save and invest the difference between what you earn and what you spend. If life throws you a curve ball, you won’t get knocked off your feet.

Living below your means doesn’t mean that you are giving up everything fun. By using a budget to plan your spending, you can include money for entertainment, clothing, or even just a miscellaneous category to spend as you see fit.

But instead of spending $500 one month and $700 the next, you plan — and stick to — your budget, which allows you to save and invest.


5. They pay themselves first.

Paying yourself first means to set aside money to invest or save — BEFORE you spend any other money. All too often, people spend spend spend, then save or invest whatever is left over. If you have no budget, have no idea how you spend your money, and have a fly-by-the-seat-of-your-pants mentality, your leftovers are meager — if anything.

When you are creating that budget, create a line for investing. Make that the first thing you put money into every week or every month. Funnel any unexpected money — like a bonus or a refund — into this category, too.

6. They invest.

Financially intelligent people invest for their future. But say the word “invest,” and people panic.

You don’t have to be able to pick stocks like a pro to invest. In fact, investing heavily in individual stocks is a recipe for disaster.

Having a diversified portfolio is one of the best ways to spread out your risk. Index funds — a collection of funds designed to mimic a specific index — give you broad market exposure. An index fund is a passively managed fund, so the fees are significantly lower than traditional, actively managed mutual funds.

Real estate is another way to diversify your portfolio, and having a passive source of income through rental properties or even REITs (Real Estate Investment Trusts) is a great hedge against the ups and downs of the stock market.

Bonds also provide a low-risk investment option, but their return is also lower than what you can find through other investment vehicles.

7. They are money conscious.

I went out to dinner with friends one night. We went for sushi, but I don’t like the idea of eating raw fish. There are a lot of options at a sushi restaurant, and I ended up with cucumber and avocado sushi, which is significantly less expensive than the fancy dragon rolls and rainbow rolls that my dinner companions were eating.

At the end of the night, we split the bill evenly. I didn’t eat nearly the same amount of food, but enjoyed my time with my friends and was OK with splitting the bill evenly amongst all of us. It wasn’t going to break me financially, and it wasn’t something I did frequently.

It wasn’t something I did frequently, but it WAS something they did frequently.

At the time, I was married with no children. Both my husband and I worked and lived frugally, far below our means. But my friends were all single, living alone, and making far less than my husband and me.

They felt they “deserved” these meals out and went out at least once a week to equally lavish restaurants, spending similar amounts on their meal. Every. Single. Week.

They had no concept of their spending. They felt no compulsion to save any amount. They didn’t invest. They weren’t conscious of their spending.

Related: 3 Habits of Incredibly Lucky People (For Better Fortune in Business & Life!)

So I didn’t talk to them about it.

Who wants to listen to someone lecturing them about money? They didn’t care about their finances, and me hopping up on a soapbox to try to sway them to my side wasn’t going to have the desired effect.

Being money conscious doesn’t mean you never spend any money. It doesn’t even mean you never spend frivolously. It means you are conscious of your spending, conscious of what things cost, and conscious of how your actions affect your future.

Being financially successful doesn’t mean you give up fun. It means you have a financial plan and you stick to it. You make saving for your future a priority, and you structure your life to reach your goals.

If you aren’t currently financially savvy, start with one of these steps. Then add another when you feel ready. Your very first step, the most difficult thing to grasp, is that you need to make a change.

What habits would you add to this list? How do you keep your finances on track?

Leave your comments below!

About Author

Mindy Jensen

Mindy has flipped numerous homes in the past 10 years, one at a time and doing much of the work with her husband. She lives in Longmont, CO, and is always looking for an ugly duckling to turn into a swan.


  1. Good article, Mindy. These are all very important aspects of money management that are unfortunately the exception and not the rule. I’m a firm believer that dreams don’t become reality through magic; they take discipline, hard work and determination. I’m fortunate to be living on passive income that was generated over many years of adhering to the seven points in your article. My friends, however, not so much.

    For example, I have a friend that is in his 50s who made an odd statement the other day. He said, “I don’t want to be like my dad, who is working five days per week at the age of 74.” Well, fine, but my friend has lived a life of excess that generated zero investments and zero retirement? Judging by his behavior, how would he NOT end of like his dad!? It is obviously not my place – nor my business – to say anything to him; but as a casual observer, it’s amazing that he doesn’t make the obvious connection as to how his dreams and desires are being negatively impacted by his behavior.

    A recent Bankrate survey found that only 38 percent of Americans have enough savings handy to cover an unexpected expense of $500 to $1000, which drives home the point of how pervasive financial illiteracy is in this county.

    • Mindy Jensen

      Thanks for reading, Randy!

      Your friend sounds like a fairly good snapshot of America in general. “I’ll save later.”

      I’m a pretty bossy person, and it’s so tough for me to not share my financial sense with other people. I see friends with less than nothing, spending freely, unaware of their future.

      And while for some people it would take a huge change in their spending to be able to retire on time – forget about early retirement – many people only need to make small changes in their behavior and spending to fund retirement accounts.

      I just wish it was taught in schools – even a small amount.

  2. Omar Sanchez

    Wow Mindy,

    That was an amazing article! Unfortunately it is too true that most people are financially illiterate. I am a newbie investor as well as a college student , so I am trying to learn from successful people as much as I can so that way I could emulate them, while helping and contributing in the process as well. I heard a quote by Grant Cardone and he said something like “over 70% of Americans have less than $1000 dollars saved”. That scared the living heck out of me when I heard that! Considering that I have read Robert Kiyosaki’s books ” Rich Dad Poor Dad” ” Rich Dads Cash Flow Quadrant ” and Self improvement books, I never see the world the same way again. Also from experience, I see people spending hundreds, and even thousands of dollars on things that have no benefit to them financially or even personally. And then on top of that, they talk about the life they want to live! If there is one thing I noticed about most people contradict themselves by saying something (s) and then they do the opposite, and then they wonder when something doesn’t workout for them. Thank you very much for this article. And this article helped a lot!




    • Mindy Jensen

      Thanks for reading, Omar.

      I’ve seen that statistic, less than $1,000 saved. I think that’s just in general, not even specifically retirement. It’s so easy to push off starting to save for retirement to a tomorrow that never comes.

  3. Jd Martin

    This is an awesome blog post and everyone new to this site should have to check a box that they’ve read it before they can post! I especially empathize with the inability to talk to other people about this stuff. Every time I have tried, it goes in one ear and out the other, so I just stopped trying. It annoys me a bit when friends/acquaintances lament on how I’m “moneybags”, or that they wish *they* could retire soon, but every time they get a dollar they borrow a second to go with it and blow it on who knows what.

  4. steve g.

    Great article. In this day of , I want, and I want right now, people spend their money even before it is earned. We need to drop the credit card mentality that makes it so easy to spend before you even get that paycheck.

    We need to take a few lessons from China. Did you know, in China, most children continue to live at home , in an effort to save up for a home?China and other nations have a save and spend mentality, while Americans have a spend then earn mentality.Spend on the credit card,then go out and earn the money to make the minimum payment.

    If we ever expect to have a bright future , we need to hold off on the luxuries and begin to save for our future while taking care of our current needs.

  5. Jerry W.

    Mindy, my pet peeve is the new car every two years. The newest car I have ever purchased was 2 years old. I drive a Lincoln Towncar because my wife’s back has issues and the nice ride and nice seats give her the best relief. I can buy those cars with only 20,000 miles or less 2 years old for a third of new price. I drive those cars for about 8 years before we look at getting a replacement. My vehicle cost is about $2K a year, folks who buy new have a yearly cost of almost $20K a year. I have never gotten that mindset. Now if you put 80K miles on a year I see it, but I often buy cars with only 16K miles at 2 years old. Over a 12 year period many folks would save over $250K they could have invested. It really gets me when you folks with small kids do this. they just wasted enough money to put one of their kids for a few years of college in a decent state university.

    • Mindy Jensen

      I have an uncle with a Towncar an I can attest to their smooth ride. But the two-year-old version rides just as smooth as the brand new model!

      I had a car that I purchased used from a friend for $2500. I got 100,000 miles out of that car, and sold it for $1,000 when I decided I didn’t need it anymore. Used cars are the way to go.

      Thanks for reading.

  6. My dad’s employer went out of business, and he got to see how people who did not save money dealt with it. These were all people who had worked for the same employer for approximately 30 years and were suddenly out of work in their 50’s. One of his co-workers was seriously contemplating suicide since he was virtually unemployable at his age and had spent every dime, plus mortgaged his house to the hilt, and run up credit card debt. He had always spent all the money he made, then borrowed more in order to “have a good time”. Meanwhile, my dad decided to go golfing with some of his co-workers since they had all saved for 30 years and did not need to go get another job.

    Good advice in this article. Saving and planning allow you to have options.

    • Mindy Jensen

      You know, Michelle, I hate stories like this, because they are so unnecessary. The situations, I mean. And the thing is, a small change wouldn’t have effected his life very much, but would have had huge results on the back end, notably not contemplating suicide.

      At least your dad did the right thing. And I bet he was as happy or happier than the co-worker who spent it all. Money doesn’t buy happiness, but it sure can buy destitution…

  7. While I’m sure there are many advantages to taking shortcuts like “living at home”, the only way to be successful in life is to put effort into the things you do. If you think that looking into your financial activity once a month is going to help you keep track of your life, you are wrong. I’m sure some people can just get it right, but you need to keep track of the gas you put in your car, the coffee you buy in the morning before work, the chips you buy after you have a few beers at the bar (and the few beers at the bar), because these are realistic things that people do. Checking your financial activity every day so you know what you can and can not do is how you’re going to be successful in life.

  8. Brad Lohnes

    Excellent tips here. Been meaning to get that will sorted for so long now…thanks for the reminder. 🙁

    I do think that your last point about being money conscious is very important. We’ve done so many things since deciding to turn our finances around a few years ago, but being money conscious would have to be at the very heart of it all. It leads to things like spending less than you earn, saving, investing, etc.

    But I also like your point that it’s not about NEVER spending frivolously. Some of us just like to spend. My wife and I keep a strict budget, I personally check our accounts everyday. My wife must also check relatively frequently because we often have these short conversations: “Hey, honey. What’s the charge to XYZ Corporation on the credit card?” “Oh, that was for blah, blah.” “Ok, are you going to pay that back?”

    Yes, our budget includes an “allowance” for each each of us to spend on whatever we want…and it’s not much, trust me. But it fulfills my urge to blow a few dollars, whether it be me spending it on gaming or my wife getting a pedicure. I have sometimes felt like maybe we’re doing it wrong since we still “blow” this money, but I actually think we’re doing it right, since this is the only money we’re allowed to fritter away.

    Thanks again – great post.

    • Mindy Jensen

      I’ve actually heard this from several different people throughout the years. I think it makes a lot of sense – especially if you are trying to make a change in your spending habits. Just like losing weight, changing everything all at once is a recipe for failure. Having an account that you can use as you see fit can be the perfect solution. You can choose to save up for something big, or make a bunch of little purchases. Thanks for the suggestion!

  9. Ashley Wilson

    This article is so on point! My husband and I actually already follow every point! The only other aspect I would add, which helped us eliminate our debt, was to have trackers set-up to not only show what you are paying off, but how long it will take to pay off each debt (mortgage, car, etc.). By visually seeing these payoffs with a forecast of your last payment, it encouraged me to save more to make those extra payments and move my payoff date up! Thus, eliminating years of payments, and most importantly interest with which I have now allocated that money to places that builds our wealth!

  10. Laura O'Donnell on

    Great article, Mindy! Being a recent college graduate, I applaud you for sharing these useful tips – I’ll definitely be using them 🙂

    One thing that I’ve heard of some people doing as well, is investing in budgeting software, like True Sky, or using budgeting apps, like Mint, to get their finances on track. That’s something I’ll be trying out, as well as the tips you’ve provided here.

    Again, thanks for providing great content!

Leave A Reply

Pair a profile with your post!

Create a Free Account


Log In Here