The way that we handle money can play a big role in determining our financial destiny. If we fritter away our income on frivolous things that don’t support our long-term goals, then we’ll ultimately end up disadvantaged.

It’s possible to change course by developing the right habits, and instilling the right sense of discipline. Small, intentional changes that stick can, in the long run, help to drive down your stress levels, and allow you to commit your money to investments that will pay major dividends – often literally.

So, what changes provide the most value?

Track Your Spending

If you don’t understand where your money is going each month, then you’ll have no hope of spending it mindfully. It’s easier than ever to spend, but it’s also easier than ever to track your spending, and to spot opportunities to save. This might mean cutting out a trip to the cafe, or getting rid of a recurring subscription that you aren’t getting good use from.

Prioritise Saving and Investing

The world of saving and investment can be intimidating, especially if you’re not disposed towards numbers and maths. But a contribution into a simple savings account can lead to compound interest – which is the most powerful means of building wealth over time. You can make a regular, automatic contribution to a savings account, and thereby eliminate the need to think about it. With this change comes a change in mindset. You’ll start to think of saving as an obligation to be met, rather than something that’s competing with your discretionary spending on luxuries.

Build Skills for Smart Investing

If you want to get the best from the stock market, then you’ll need to understand exactly how it works. If you don’t understand the fundamentals, and key concepts like diversification and hedging don’t enter into your thinking, then you’re more likely to make unwise bets, and to assume more risk than you can handle.

Fortunately, there are plenty of high-quality resources available for those looking to learn stock market trading. Pick out a good one, and get started.

Create Sustainable Daily Habits

The power of habit should be leveraged, not just in support of your financial objectives, but also in support of your personal well-being. Planning your meals ahead of time and walking to work instead of driving can not only help you save money, but it’s also an investment in your health.

For a habit to really stick, you’ll need to persist with it for several hundred days. Use a habit-tracker, and try to build routines that limit your scope for impulse buying.

Maintain Work-Life Balance

You don’t need to make earning and saving the centre of your life. Rather, it should be something that happens more or less automatically as a result of the systems you’ve built. By making thoughtful choices, and developing the right skills when it comes to budgeting and investment, you’ll free yourself from financial pressure in the future.

Conclusion

Habits, rather than goals, are ultimately what shape our financial futures. You’ll need to think about how you’re going to spend when your willpower is depleted, and you’re being bombarded with temptation. Learning opportunities, and financial education, might also be critical in safeguarding your long-term independence.