Posted on April 9, 2025 by StackD Team
We all dream of financial freedom and success, but the road to wealth isn’t about luck. It’s about the daily habits you form. Whether you’re starting from scratch or looking to level up your wealth game, these five habits can change your financial future. Here’s how they work and how you can implement them in your life.
The Habit: Spend less than you earn.
One of the most critical steps in wealth-building is living below your means. It's easy to get caught up in spending more than you earn, especially when you feel pressure to keep up with friends or trends. However, consistently spending more than you make is a fast track to debt and stress.
Why It Matters: If you save and invest the difference between your income and your spending, that’s where the real magic happens. You can use the extra money to build your wealth instead of letting it slip away on unnecessary expenses.
Example: Let’s say you earn $5,000 a month, and your living expenses amount to $4,000. If you consistently save and invest the extra $1,000, that’s $12,000 a year you’re putting toward building wealth. Over 20 years, assuming a conservative 7% annual return on investment, that $12,000 invested yearly could grow to $484,000!
Tip: Track your spending using a budgeting app like StackD, set clear savings goals, and cut back on non-essentials.
The Habit: Make investing a regular part of your routine.
Investing early in life is one of the best ways to build wealth. It’s often said that “the best time to invest was yesterday, and the second best time is today.” The earlier you start, the more time your money has to grow through compound interest.
Why It Matters: Compound interest means that your money earns interest, and then the interest itself earns interest. This snowball effect can result in enormous growth over time.
Example: If you start investing $500 a month at age 25, assuming a 7% annual return, by age 65, you could have $1.4 million. But if you wait until you’re 35 to start the same strategy, you’ll only have around $700,000 by age 65. That’s a $700,000 difference just because you waited 10 years to start.
Tip: Open an IRA, 401(k), or brokerage account, and set up automatic contributions to make investing effortless.
The Habit: Build relationships with others who have similar financial goals.
The people you associate with have a big impact on your mindset and habits. If you surround yourself with people who prioritize financial success, you’re more likely to adopt those habits yourself. On the other hand, if you're surrounded by people who live paycheck to paycheck or have a poor attitude toward money, it can be easy to fall into bad financial habits.
Why It Matters: Success is contagious. By spending time with financially successful people, you can learn from their experiences, gain motivation, and even find opportunities to collaborate.
Example: Join online communities, local networking events, or mastermind groups. Even being in a group of people who are serious about improving their finances will help you stay focused and motivated.
Tip: Seek out groups or mentors who align with your financial goals. Engage in conversations that challenge your thinking and expand your financial knowledge.
The Habit: Set up automatic transfers to your savings and investment accounts.
Automation removes the need for constant decision-making. If you set up automatic transfers to your savings and investment accounts, you’ll ensure that you’re consistently putting money away for the future without even thinking about it.
Why It Matters: Automation reduces the temptation to spend the money on something else. Over time, the money that automatically gets set aside grows, and you don’t even notice it.
Example: You can have $500 automatically deducted from your paycheck every month and deposited into a high-yield savings account or investment account. Over 10 years, assuming a conservative 6% annual return, that $500/month could grow to $86,000.
Tip: Set up automatic transfers through your bank or employer, and choose a percentage of your income to be automatically saved or invested.
The Habit: Make learning about personal finance and investing a lifelong pursuit.
Financial knowledge is one of the greatest assets you can have. The more you understand about how money works, the better equipped you’ll be to make smart financial decisions. Reading books, attending webinars, and learning from experts can give you the tools you need to build wealth more efficiently.
Why It Matters: The financial world is always changing. By staying informed, you’ll be able to take advantage of new opportunities, avoid common mistakes, and make decisions that can accelerate your wealth-building journey.
Example: Imagine reading a book like “The Intelligent Investor” by Benjamin Graham and learning about value investing. By applying that knowledge, you could make investment decisions that outperform the market average and significantly increase your wealth over time.
Tip: Read financial books, listen to podcasts, and subscribe to reputable financial blogs (like StackD’s blog) to stay updated and educated.