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  • Writer's pictureHarry N. Stout

160- Ten Good Money Habits: Part 2

Updated: Jan 15, 2021

This is the second part of the two-part post on developing good money habits. It was developed in response to a subscriber’s request for 10 habits they could develop to improve their money life. We will begin with habit number six.

6. Use Technology to Automate Your Money

This is an excellent habit to form for a variety of reasons including saving money on late payment fees to increasing your credit scores by improving credit history. Automating your finances also helps you achieve specific goals by creating a positive long-term habit while fighting the temptation to deviate from your cash budget planning. Setting up an automatic payments and savings deposits requires just a little effort.

If you are like me, you can automate the bulk of your monthly recurring payments (e.g., rent, mortgage, utilities, credit cards, personal loans, insurance coverages), savings actions and investments.

7. Make Savings a Priority

As I have written frequently in my books and posts, if you want to make sure you’re not overspending, create a cash budget and make it part of your reflective money practices. The habit of creating and using a budget should result in you generating excess cash. If you want to grow your savings, you should take this excess cash and pay yourself first. That means putting your excess cash into your savings account. You can do this by auto-transferring dollars into a savings account or saving a percentage of your take-home pay each month.

Saving regularly over time will yield significant financial benefits. As I have said given the pandemic impacted world we live in, you need to save as much as you can for your future and life’s unexpected events.

You must save regularly to build up a savings buffer over time. And no matter whether you’re building your emergency fund, saving for a home, saving for travel, or saving for the future with no specific goal in mind, it’s consistency that will help you reach your goals. It is amazing to me to see how just saving small amounts over time has created large amounts for later in life.

8. Monitor Your Credit Scores

As I have written, you need to pay close attention to your credit scores. As you journey through the FinancialVerse, the results of your financial credit decisions will be closely monitored by what are called credit reporting agencies. The credit reporting agencies are the key gatekeeper for you to obtain the credit you need during your lifetime. The three main agencies are Equifax, Experian and TransUnion.

These agencies monitor key aspects of the credit relationships you establish. They mainly look at five key aspects of your actions, which include:

  1. Your payment history

  2. Credit utilization

  3. Credit age – how long the relationships have been in place

  4. Recent credit applications

  5. Mix of credit

Each of the credit reporting agencies has extensive websites that describe their ratings and the process conducted to determine them. The websites will also direct you as to how to correct any information that is incorrect in the final reports. Your bank or credit card company usually has a section of their website that shows your credit scores.

The majority of companies to whom you are paying bills report the timeliness of your payments to the credit reporting agencies and help create a permanent record of your actions. It is one of the key determinants of your ability to get credit. You must know your score and monitor it. You need to be vigilant at all times when it comes to your credit.

9. Look to Save on Recurring Purchases

Once people have developed a money mindset and have implemented a cash budget, they develop an awareness of how much cash inflow it takes to support their spending, particularly what they spend on recurring purchases. They then try to discover effective ways to spend less.

You can do this by reviewing your monthly expenses and researching ways to reduce or eliminate the need for the expense. This includes considering everything from unneeded monthly subscriptions to the major decisions in life such as where we live and how we live. The lifestyle decisions. Saving money on recurring expenses can have a profoundly positive impact on your cash flow and savings. A deep dive into your spending habits can begin this journey for you.

10. Celebrate and Spoil Yourself for Reaching a Goal or Achieving a Milestone

I know that spoiling yourself or celebrating a key milestone does not seem like a “good” financial habit, but I have found that it is very important. These is no sense making financial goals and achieving them without a celebration of the accomplishment. For example, each year of my working life I earmarked 10% of any bonus I received for me to spend as I wanted.

This included buying the car I wanted or taking the trip I dreamed about.

I have found the celebration of reaching goals or milestones a very reaffirming act for me. One that has motivated me to reach or exceed the next goal I have set for myself.


Developing good financial habits takes some study and practice. Remember, a habit is defined as a way of behaving that is repeated so often it no longer involves conscious thought. Many people manage their money with four or five key habits. This discipline has led them to financial success and security. In the FinancialVerse, practice makes perfect. Once you develop the proper mindset and improve your financial knowledge you can develop the money habits you need for success.


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