#1: Time is your ally
Take advantage of the time value of money. A twenty-year-old who invests $4.25/day over fifty years at an 8% average annual investment return can be a millionaire. At age 30, the required amount rises to $300/month. Whatever age you are, start now! Let compounding help you.
#2: Avoid “bad” debt. Use “good” debt sparingly
A reasonably-sized mortgage and student loans may qualify as “good” debt. Everything else is generally “bad” debt. Be savvy about your borrowing and strive to “pay as you go.”
#3: Distinguish between wants and needs
The things you “need” to survive are limited. To shrink expenses, scrutinize your “want” list. Avoid the binge-dieter syndrome where you starve yourself by not buying and then go crazy with the credit cards because you’ve denied yourself for so long. If something adds value, buy it if the budget allows.
#4: Never pay full retail
You can usually get the things you want at a price much less than the first one you see. Shaving a little bit off the many purchases you make adds up to serious money at the end of the month.
#5: Pay attention to fees
Be aware of the consequences of multiple transactions where little bits of cash are being unnecessarily siphoned off because you haven’t been paying attention.
#6: Develop good financial habits
Financial success depends on identifying your good and bad habits. Systematically root out the unhelpful habits and replace them with something that moves you closer to success.
#7: Understand your risk tolerance
Assess your tolerance for investment risk to avoid being shocked by a possible adverse outcome. Take only the risks you are comfortable taking. However, be aware that your ability to accumulate substantial assets over a lifetime is greatly affected by your savings and investment choices.
#8: Continuously educate yourself
Read every financial periodical, book and blog you can find from well-regarded authors. Get to know smart, honest people who are passionate about personal finance. You will learn a lot.
#9: Know the role money plays in your life
What does money mean to you? How does it fit into the dreams and goals you have for your life? Thinking about these topics proactively will enable you to frame your philosophy about money, how you want to accumulate it, and how you want to spend it.
#10: Treat it as a game!
Make it fun. Don’t be a spectator oblivious to what’s going on around you. Every establishment that takes your money is playing the game with you, whether you like it or not. Think back to when you first learned a game that you’re now passionate about. What kind of practice did you need to do to get good at it? What did it feel like to win