This post may contain affiliate links. This means that if you click on one of my links and make a purchase, I receive a commission at no extra cost to you. See the full affiliate disclosure here.
Your Financial Takeover Starts Here
How to Improve Your Money Management and Build Savings – Even When It Feels Impossible
Best Money Habits to Build Wealth
Have you ever felt stuck trying to save money, even though you work hard to earn a steady income, yet somehow your savings never seem to grow? You’re not alone.
It’s discouraging when you’re putting in consistent effort; however, your bank account doesn’t seem to reflect that progress.
I know the feeling firsthand. My husband and I are both professionals with stable jobs, yet we felt like no matter how much we earned, we were always playing catch-up.
Something always came up; unexpected bills, medical expenses, weddings, etc. that set us back just when we thought we were getting ahead.
It wasn’t a lack of effort. It was a lack of direction. We were in the same viscous cycle as so many people; earning, spending, and hoping to save “what’s left over.”
But what we really needed were practical, sustainable financial habits, and a better way to manage our money with intention to grow wealth steadily.
Once we adopted proven financial habits, like disciplined budgeting, debt reduction strategies, and smart investing, we started making real progress toward financial freedom.
Here’s exactly how we did it, and how you can too!
Here are Our 11 New Habits that Leave Us with More Money!
The Power of Smart Budgeting and Debt Management
1. Set Clear Financial Goals: Best Money Habits to Build Wealth
You can’t hit a target you can’t see. I thought to myself, how do I know how much I need to set aside if I don’t have a financial goal to reach towards?
One of the strongest habits of financially successful people is setting specific, measurable financial goals.
Sit down (ideally with your partner) and write down your financial goals for the next six months, one year, five years, and even ten years.
Be as clear as possible with your goals. For example:
- Pay off $8,000 in credit card debt in 8 months
- Save $25,000 for a home down payment in 24 months
- Build a $15,000 emergency fund in 12 months
- Invest $500 per month for retirement
This is how you turn abstract dreams into actionable goals.
You can, but don’t necessarily have to, get majorly detailed with it; instead, you just need something measurable to work toward.
Pro Tip: Setting goals gives your money direction. Without direction, your money disappears; with it, your money multiplies.
Putting it into Practic
Last year, I helped my cousin set realistic savings goals to keep herself accountable. We made it fun with regular check-ins, and even though it got tough at times, that structure really paid off in the end.
She used to spend heavily on frequent home décor shopping trips, something she loved, but it added up fast. By shifting her focus toward saving and intentional spending, she made a huge turnaround.
Now a year later, she’s just 5 months away from paying off her student loans, hit her savings goal 3 months ago, and continues to build on it.
A year ago, she had no financial plan. Today, she’s taking control of her money and building real financial stability. She still enjoys those home décor shopping trips but more responsibly.
With the right plan, a little accountability, and consistent effort, real progress is possible.
2. Budget Like a Boss (Without Feeling Restricted)
Most people think of budgeting as a punishment, but it’s actually the key to financial freedom.
Imagine not having to live paycheck to paycheck! Doesn’t that sound like a huge breath of relief you yearn to experience?
Don’t be fooled, budgets can actually be easy to follow. You don’t need complicated or fancy pie charts and diagrams. (Admittedly, I’m of the sort that drools at the site of a colorful pie chart.) But for the sake of practicality, I now use an easy budgeting method.
Read ‘The ‘Goal Focused Budget’: The Easiest Budget Method You’ll Ever Need’. — it’s the easiest way to manage money without feeling deprived.
Here’s how it works and it all starts with Knowing Your Numbers:
- Calculate your net (after-tax) income.
- Write down your essential expenses: housing, food, utilities, insurance, transportation.
- Allocate a portion of your income to your goals: saving, investing, or paying off debt.
- Whatever’s left can be spent guilt-free on subscriptions, entertainment, dining out, or travel.
Simple! You’re not restricting your life; you’re prioritizing your freedom.
This habit of budgeting and awareness on spending provides good character building, practices self-control and helps you avoid making purchases haphazardly.
Quick Tip: Review your budget monthly. Ask, “Does this expense move me closer to my goals or further away?” Small adjustments compound into huge progress.
3. Smart Money Habit: Track Your Spending Weekly
This simple habit changed everything for us.
I’ve made my share of careless spending decisions. I often avoided facing the reality of my habits. But avoiding it only increases anxiety. Knowing the truth whether good or bad is what lets you move forward.
Replace that anxiety and stress with a plan and you’ll prevent a bigger problem happening later.
The more you track your expenses, the more it becomes second nature. Over time, you start making smarter choices in the moment – pausing before you swipe your card or hand over cash.
When you start tracking your spending, you instantly become more intentional.
Log in to your bank account weekly, review your transactions, and ask yourself:
- Where did my money go this week?
- Which purchases brought value, and which didn’t?
- How can I adjust for next week?
You’ll quickly start noticing unnecessary subscriptions, late fees, or impulse purchases you didn’t even remember making.
Ask yourself “why” not just “where”. Where your money ends up is important but knowing why you choose to spend your money on a particular product or service is just as crucial.
We find ourselves paying for things that might not benefit us or paying monthly for subscriptions we hardly use. How do we justify these expenses?
Start this habit and you’ll likely find you can save hundreds every month. That’s thousands a year you can put towards your financial goals instead.
There are great apps like Mint, YNAB (You Need A Budget), and Empower that automate the process of tracking your expenses.
Pro Tip: Awareness equals control. When you know exactly where your money goes, you can redirect it toward what truly matters.
You’re on the right track learning the 11 Best Money Habits to Build Your Wealth and Financial Freedom
4. Avoid High-Interest Debt: Financial Freedom Habit
Credit cards can be both a tool and a trap.
If you’re paying interest, the trap has already sprung. High-interest debt is like a leech, quietly draining your financial health while you barely notice.
Let’s say you buy a $1,000 phone on a credit card with 20% APR and only make minimum payments. That phone ends up costing you over $1,700 and takes 7 years to pay off.
I get it, sometimes unpredictable emergency purchases are necessary but that is the point of having an Emergency Fund. We’ll touch on that below.
Credit cards can offer benefits but only if you use them responsibly. If you’re still building discipline around spending, it’s perfectly okay to stick with cash or debit.
Don’t you worry, you’ll soon reach a point where you can enjoy credit card perks like cash back, travel rewards, and more. This is your Financial Takeover, after all.
To break free, use one of these two methods:
- Debt Avalanche: Pay off the highest-interest debt first.
- Minimize Interest, Maximize Savings
- Best for: Saving the most money over time
- You reduce how much interest you pay overall, which helps you get out of debt faster if you stay consistent.
- Debt Snowball: Pay off the smallest balances first for quick wins.
- Build Momentum with Quick Wins
- Best for: Staying motivated and seeing quick progress
- Those early “wins” give you a psychological boost and help you build positive money habits.
Remember: The key to building wealth isn’t just how much you make; it’s how much you keep.
5. Build Financial Knowledge
Financial literacy is a superpower.
The more you learn about money and investing, the faster it grows.
Learning financial terms and getting comfortable with reading financial literature without fully understanding everything at first, is a key step. The more you read, the greater your understanding and familiarity becomes.
Start small:
- Read beginner finance books (like The Simple Path to Wealth).
- Watch YouTube channels or podcasts about investing and budgeting and personal finance.
- Read finance blogs (like this one!) regularly to get money management tips.
You don’t need to be an expert, just curious and consistent with expanding on your financial education. Building your confidence through financial education will translate to action!
Pro Tip: Wealthy people never stop learning. Financial education builds confidence and confidence builds wealth.
6. Use a High-Yield Savings Account
Most traditional banks pay you less than 0.05% interest on your savings annually, that’s practically nothing. That means if you have $5000 in a savings account, without making any additional deposits or withdrawals over a 10-year period, you’d earn a whopping $5! (Insert eye-roll emoji here).
I am all about making my money work for me and you should be too. I have worked for my money since I was 15 years old and for a long time did not have much to show for it.
I recommend parking the money you are not investing but maybe saving for a home, a car, or any other purchases into a high-yield savings account.
A high-yield savings account (HYSA) can offer 4–5% interest annually.
That means your $5,000 can grow to $7,401 in 10 years with no extra effort.
Now isn’t that more of an appealing option?!
Top HYSA options:
- UFB
- CIT Bank
- Ally Bank
- Marcus by Goldman Sachs
- Discover Online Savings
- SoFi Checking & Savings
This is the easiest way to let your money work for you while staying safe and accessible. Take time to find the best savings account for you.
Believe in Yourself, You Can Reach Your Financial Goals. Just Keep Reading!
7. Build a Strong Emergency Fund
Life is totally unpredictable! To make sure you’re not pulling money for emergencies out of your savings or investments and to avoid taking out loans or swiping credit cards, racking up debt, you should have an emergency fund.
In 2020, the world experienced a pandemic that proved how important it was to have your finances in order.
You’ll want an emergency fund that includes 3-6 months’ worth of expenses. If that seems intimidating, start by saving one month’s worth of expenses, then work your way up.
I myself like to add extra for unpredictable short-term emergencies, i.e. hospital bills, car or home repairs.
Make sure you store your emergency fund in a separate HYSA so you’re not tempted to spend it. A financial safety net such as an emergency fund will lead to more financial stability as your other funds and investments grow without the risk of dipping into them.
Remember: An emergency fund isn’t fear, it’s freedom!
8. Create Sinking Funds for Non-Monthly Expenses
People often overlook this money saving secret!
It’s called a Sinking Fund. This is for expenses that don’t happen as frequently as your monthly expenses but still need to be accounted for, i.e. Vacations, Holidays, Birthdays, etc. All in all, it’s a mini savings accounts for occasional but predictable expenses.
In the past, I would always get anxious around the end of the summer as there’s birthday after birthday in my family. I was never prepared financially and would not get to enjoy the anticipation of celebrating as I was overwhelmed with stress.
It was similar around the holidays, from gift-giving costs and the increase in our grocery bill as we would indulge in specific holiday meals and treats. I always felt like we were spending more than we had available.
I came to realize I was going in “blind” when shopping because not having a set amount allocated for the holidays left me susceptible to extra spending.
Here’s what you do, estimate what you spend annually on each occasion then divide by 12. Then, save that amount monthly. Stow it away where you feel comfortable.
You’ll stop relying on credit cards for planned spending and actually enjoy those events stress-free. This money organization hack, saving for the holidays and all sorts of fun, will leave you feeling like a champion!
9. Pay Yourself First (My Favorite!): Best Habits of Wealthy People
This is the biggest habit to set for reaching your goals, the golden rule of wealth building!
When your paycheck hits, automatically move a portion to savings or investments first, before paying bills or spending. You’re prioritizing your future self over your current impulses.
Whatever you decide to allocate is based on the goals you previously listed, the dollar amount it will take on a monthly basis to get there in your specific timeframe.
The rest goes towards expenses whether it’s bills or other costs. That’s right, here you are prioritizing yourself, because your future self-matters! This savings habit is a smart money move.
A key tip here is to consider making lifestyle adjustments to fulfill your goals. When you start allocating money to your goals as a priority, you will find yourself dedicated to finding more ways to save money on your expenses to get on the fast track to financial independence.
Your financial health is a critical aspect of your life. Maintaining poor financial habits can affect you mentally, emotionally and physically. Working towards reaching a better financial state will translate positively into other areas of life.
Pro Tip: Treat saving like a bill you can’t skip. Consistency create compounding results.
10. Be Mindful of Lifestyle Inflation
I’m a big believer in enjoying the “now” and “there’s no time like the present”. I’m not a fan of being super restrictive when it comes to living life.
However, there should be a realistic approach to this. You have to be practical with your current financial situation. There are many alternatives to having fun that are inexpensive.
Lifestyle inflation happens when your spending increases as your income grows. Often spending on expensive habits or luxury items you don’t truly need or can’t comfortably afford. Over time, these unnecessary costs slow down and even derail your path to financial independence.
In the end, that extra money usually goes to things that feel exciting for a moment but lead to bigger bills later. Before you know it, you’re right back where you started.
It silently kills your savings potential. So, stay intentional!
Budget and plan for the things you really want. Even before you do that, really think about how important that “thing” is for you before you spend your hard-earned money on it. Will this be an expense that only gives you short term gratification?
Money Mindset Shift: Instead of upgrading your car or buying more gadgets, redirect those raises into your savings, investments, or debt payoff.
I am not just talking about savings now for retirement many years later. You can make better choices now for the short-term future as well.
As I said, enjoy yourself in this life. But don’t get carried away because things truly add up QUICKLY!
Pro Tip: Restricting yourself (especially temporarily) is not a bad thing when it is necessary. It serves to help build character and discipline.
11. Review and Reflect on Your Finances Regularly: Financial Independence Habit
Wealthy people don’t set it and forget it. They review.
Routinely checking your finances will keep you on track with your financial goals and maybe even get you there quicker.
Take one day a month to review your finances with your partner (or solo) and uncover whether you’re staying on track and if changes need to be made in your approach.
Here is what you should analyze during your financial checkup:
- Review and reevaluate your Goals
- Go over your budget and spending (are they in line with your goals?)
- Discuss any upcoming payments and events that need to be budgeted for
- Check the status of all your funds: Investments, Retirement, Savings, Emergency Fund, etc.
- Make modifications as needed
- Lastly, write down new ideas i.e. side hustle / passive income to reach financial independence sooner
The more attention you give your money, the more it multiplies.
Final Thoughts: Build Wealth with Intention
These 11 habits aren’t just about saving more, they’re about transforming your relationship with money.
When you make these steps part of your everyday life, you’ll:
- Eliminate financial stress
- Grow consistent wealth
- Build freedom for your future self
Financial success isn’t about perfection, it’s about progress.
Even small steps like tracking expenses, paying yourself first, or reading one finance article a week can completely change your future.
Start today, and let this year be the one where you stop surviving and start thriving financially.
I will help you learn the tools you need to make better financial decisions, improve your money-management skills, and get you on the path to retiring early and enjoying financial independence.
I care to make this a fun journey rather than a restrictive one but that takes being mindful, practical, and intentional with your financial habits.
Sign up to be part of the email list and continue to get insightful personal finance tips.
Until next time,
The Financial Takeover
Pingback: How Do I Prepare Financially for an Early Retirement - The Financial Takeover