How to develop healthy personal financial habits

I recently read an article in an online magazine that focused on the higher habits of elite athletes. It was very simple, but the simplicity belies its depth. These are the habits that make them excel and stand out.

Think Muhammad Ali, Rafael Nadal, Michael Jordan and Manny Pacquiao. These people weren’t heroes in their field for nothing. What they are is an achievement that was set up long before the fight, and discipline followed every step of the way. Reading Habits has impacted me, an “a-ha” moment as these are the same principles in personal finance and can also be applied with the same results.

Let me share with you some of these habits I have read and how they can help in your financial life:

Visualize success. Start at the end. And you don’t want the end to be one of failure, you want it to be the end. To start living the life of your dreams means having those dreams first, establishing them and knowing that you can make them come true.

Visualize your dream home, your dream car, your dream retirement life, your dream lifestyle, the education of your dreams to your children, your dream of helping people. Having this vision makes you work harder and smarter. It gives you purpose, perseverance, courage, hope and this gana (enthusiasm) to do your best no matter what.

As far as my personal finance experience goes, a lot of a person’s challenge is psychological and behavioral rather than technical. It’s not a question of knowledge – information is now available almost anywhere, anytime – but more about making a self-restraint and learning more about how to become financially sound.

Visualizing success also gives you confidence that you can do something with your life, no matter the circumstances. I was once a savings account type, but I really wanted to experiment with investments and experience the higher returns that you have always been proud of.

The minimum investment at the time was 100,000 pesos, so I set aside about half of my monthly salary and all of my bonuses just to raise myself over that big hurdle. I sacrificed the enjoyment of my salary – buying gadgets, traveling, partying – for the end of the investment. I did, and it was an instant success.

Identify with successes. Who doesn’t draw inspiration from the lives of Henry C., Socorro Ramos, and a host of other entrepreneurs with their poverty-to-riches story?

These aren’t Disney princesses or telenovela stories, but true stories about design against all odds. Having a model for success enables you to learn from their experiences – mistakes, accomplishments, everything.

I think that’s why Go Negosyo is such a genius and a hit – he brings upbeat and new entrepreneurs to connect with established people to learn from them the secrets of owning a business and managing their resources.

Being successful also means recognizing our own successes and learning from our mistakes. You may have exhausted a long time in the past with your investments when you withdrew your money – in a bear market.

After that, I saw the market rise and recover again. Lesson learned: Invest long term and don’t realize losses when the market is less than six feet away.

I have one mistake (among other things) in dealing with money: not diversifying. With stock market returns soaring during the bullish season from 2007 to 2018, I put all my savings – as in all – into a stock fund. Come 2020, when I needed money – and luckily, my money also lost its market value – I had to pull some with not only realized losses, but lessons as well.

Follow individual programmes. No two people are the same, and no two families are the same. Why should they have the same financial setup? Each has its own needs and aspirations. As well as with personal finance.

There is no categorical cookie approach to this. Everyone is treated differently. Different lifestyle, different aspirations, different needs and requirements equal different approaches.

Those who are starting their career can invest a modest portion of their money in the stock market and experience the life changing unit of protection; But the retiree, in this respect, may have more of his portfolio in fixed income, with little, if any, equity allocation.

When I was single, I could set aside half my salary for savings and investments, cutting expenses here and there. But now that I’m married and have a child, the cash needs have changed, as has my expense structure.

Set goals. Setting goals is essential. Is that true. I think this is one of the most talked about and under-active parts of financial planning so far. Without goals, you wouldn’t end up anywhere.

Set realistic and achievable goals. This way, you won’t chomp on more than you can chew or get frustrated in the end because you’ve achieved a goal that’s too big.

It makes you set a roadmap and business goals that you will work on. Think of the vision as the buffet cycle, goals, and individual menus.

Get a coach. Imagine if Manny Pacquiao didn’t have Freddy Roach, or if Ateneo didn’t have Norman Black. Athletes have different types of coaches – strength coach, nutrition coach, athletic coach. Each has its own set of areas in the athlete’s life to contribute to the overall performance. It’s the same in our lives.

We have doctors for our health, architects for our homes, and lawyers for our legal needs. Fortunately, there are people who are only dedicated to providing the same level of expertise and experience when it comes to one’s financial health – financial planners.

But anyone can claim or print a “financial planner” address on their calling cards.

What you want are rigorously trained, reliable, knowledgeable and experts in this field like people who are Registered Financial Planners, a reputable and well known label not only locally but internationally, with defined international standards in knowledge and ethics.

Rienzie Biolena is a Registered Financial Planner for the RFP Philippines To learn more about personal financial planning, attend the RFP 95 in May 2022. For inquiries, email [email protected] Or send a text message to 09176248110.

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