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The 4 Essential Habits for Being Smart About Money™

Habit #1: Paying Attention

One of the most important habits for being Smart About Money™ is paying attention. 

Technology has made spending effortless, while monitoring money often requires extra steps. It’s easy to tap a card or click a button without noticing the total. That’s why many people aren’t sure what they spend in a month. Developing simple habits to track balances and understand where money is going creates awareness, and awareness is where change starts.

Habit #2: Avoiding Bad Debt

Not all debt is the same. One way to identify bad debt is to ask whether the debt lasts longer than the thing you’re borrowing to buy. When purchases like vacations are put on credit cards and paid off slowly, interest quietly increases the total cost. Avoiding bad debt means planning ahead and deciding not to spend more than you’ve saved. This habit protects future choices. See more about how a personal escrow bucket can help you avoid bad debt in this video.

Habit #3: Living Beneath Your Means

Living beneath your means is about creating a monthly surplus. It’s what allows you to handle new tires, plan vacations, and save for retirement without stress. The key is understanding the difference between needs and wants. Wants are where your power lives. When you’re clear on them, you can decide which ones truly matter and align spending with your priorities. See this video for more on tracking your money wisely.

Habit #4: Investing in Your Future

Investing consistently is what turns good habits into long-term outcomes. A common guideline is to save about 16% of earnings for retirement, using employer plans, IRAs, and bridge accounts if needed. Starting early and committing to long-term investing allows compounding to do the heavy lifting over time.

Building wealth isn’t about doing everything perfectly. It’s about practicing habits that support the future you want, one decision at a time.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Traci Richmond and not necessarily those of Raymond James.

Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize or sponsor any of the listed websites or their respective sponsors. Raymond James is not responsible for the content of any website or the collection or use of information regarding any website’s users and/or members.

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