15 Simple Habits to Improve Your Financial Life

You don't have to know everything about finance to reach financial success. I’ve read a lot of books on finance (so you don’t have to), and along the way I’ve identified 15 tips to increase your financial success, career flexibility, confidence, and yes - even happiness.

Here are 15 financial tips to buy time, confidence, and happiness.

8 Tips to Buy Yourself Time

Saving money is buying yourself the one thing most people never buy themselves when it comes to pursuing their ideal life: time. Time to figure out what it is. Time to get good at the skills required. Time to meet the people who can get you opportunities that turn into paychecks. Time to make your dream job your actual job.

Here are eight spending categories full of ways we can buy ourselves time:

1. Clothes

Buy second hand (start practicing the philosophy “new to me still feels like new”); only shop clearance or at outlets; sign up for weekly mailers that offer 50% coupons; use apps like ShopSavvy to find deals; count the number of clothes you buy and then whenever you buy one thing you get rid of one thing; count the number of items of clothing you buy in one month and trying making it your monthly maximum; shop in your own closet -- oftentimes the things we wear the most end up on top and we forget about items of clothing we already have.

2. Vehicle

Use the bus, a bike, or a carshare program in your community; save thousands by buying a good used vehicle with the help of a mechanic who will inspect any car you look at for $50-$100; don’t lease if possible (less than 1 in 5 millionaires lease) – unless you are running a business and can use it as a substantial tax deduction; take an automotive class so you can do recurring repairs like changing tires/oil/brakes yourself; if you really want to drive a luxury vehicle you can always rent one from a rental company once or a few times a year.

3. Social Life

You can always responsibly pre-game before you go out, or set a price ceiling on drinks you’ll have that night (leaving your credit card at home 

and paying in cash is a good way to help this happen); find fun things to do that don’t involve continuous drinking (going to an open mic, play, game, mixer); don’t smoke or enroll in a supportive program to help yourself quit (because the lifetime total cost of smoking for approximately 50 years is upwards of $500,000 when you add in future health care and higher insurance premiums – making your per pack cost almost $40); surround yourself with people who are comfortable fielding cheaper entertainment ideas rather than simply paying in order to fit in with everyone else – this is the number one way you can increase your savings).

4. Food

You’ll save $2,500 a year by making lunches from groceries rather than eating them at restaurants; join a Local Flavor/JumpOnIt/Groupon email list to get major discounts on restaurants; choose the number of times you’ll dine out in a month (scientific research shows that when you make restaurant meals an occasional treat you enjoy them more); deliberately plan get-togethers outside of mealtimes; use apps like Divvy or Splitwise to split the bill in a quick and awkward-free way; go to financial aid workshops that offer free food ☺

5. Travel

Travel isn’t cheap, but there are all kinds of ways to lower your overall trip cost. Look for flight and hotel deals using Groupon; use Autoslash for cheaper car rentals; Momondo.com for cheaper flights; AirBNB and CouchSurfing for cheaper hotel options; Priceline’s Name Your Price feature allows you to bid for your ideal price on hotels or rental cars; make sandwiches or portable meals for your entire flight day so you can avoid buying soup for $16; tighten spending in one category (eg. meals or hotels) so you can spend more on a category that’s more special for you (eg. theatre or adventure excursions).

6. Devices

Buy older model phones from Ebay or Craigslist or your friends; ditch expensive 2-year contracts in favor of prepaid plans like PagePlus or Cricket or Republic Wireless (there are lots of these); practice gratitude for what you have (it sounds cheesy, but it’s a fair point given that the capabilities of the phone you have now would probably break the brain of someone from just 5 years ago); use wireless instead of data when downloading apps and streaming video to decrease your need for a large data plan; Google ‘phone bill analyzer’ to see if you actually need all the minutes and data you’re paying for.

7. Lottery

Short version: don’t play the lottery. Despite the ads, it’s designed to defeat you. Even if you win, it creates problems. Google ‘Lottery Winner Horror Stories’ if you don’t believe me. Instead, develop the habit of saving the money you would have spent on tickets. When you eventually discover the big move or risk or change you want to make in your life, AND you have the money saved up to do it, you will feel like you’ve won the lottery. Congrats, because that’s going to be a killer moment for you.

8. Friends

The financial term for your friend circle is a “Lifestyle Reference Group.” No one has greater impact on your values, attitudes, and actions than the 5 people you hang out with the most. Your most effective strategy is to be the kind of friend who doesn’t pressure others to do expensive things without checking to make sure it works for them. Be that friend until you are surrounded by those kinds of friends. Go to dinner with people who don’t mind splitting the check fairly, and who don’t give you crap about having an old phone, and who don’t make you feel like you have to measure up to some impossible standard. And while you’re at it, try as hard as you can to date people like this.

3 Tips to Build Your Confidence

Confidence is the single best skill to develop in order to build a network of opportunities, take career risks you wouldn’t otherwise, and negotiate for more money. Confidence brings you money. But in keeping with the theme of this list, money can also bring you confidence. Here are three places to start.

1. Food

Food is on this list twice? Yup. It has been said that if you only have one hour a week to think about your health and exercise goals, you should spend that hour thinking about your diet. Nothing has a greater effect on your ability to work productively, approach others confidently, and live your life positively than what you eat.

We tend to think of Japan as a very healthy culture. Did you know Japanese citizens spend 1.5x more of their total expenses on food (21.8%) than Americans do (14.6%). Seems relevant.

Most of the food that is marketed to us and conveniently located in the center of the grocery store is cheaper, and also filled with added sugar and processed ingredients. But there’s good news: for $10 you can make 12 salads. With another $10, you can make 10 green smoothies/juices. And for another $10, you can make a veggie chili that will feed you all week. Or better yet, a vegan casserole (no cheese or meat) that tastes every bit as amazing as it sounds disgusting!

Also, for the .00000000001% of people who like black licorice, there’s a vegetable called fennel that tastes exactly the same. And is good for you. So if that’s you, you’re welcome.

2. Travel

I love travel. Travel gives you more things to talk about, and a greater understanding of the world around you. It shows you a world you will *NOT* see on the news. The business model of television news is to scare you into buying more stuff and watching more TV. I’ve traveled to about 25 different countries and spoken in 40 states.

I’ve AirBNBed all over the US. This is a great way to save money on a trip, allowing you to travel more and see more places. It also allows you to discover how unfounded most of your anxiety about strangers is. One time I AirBNB’ed in Devils Lake, North Dakota. Already, yikes. The place where I stayed was at the end of a dirt road. When I pulled in, I thought, “Yeah… I’m gonna die tonight.” I pictured every horror movie I’d seen, and was sure that by 3am I’d be running for my life through a dark cornfield. But guess what? The hosts were kind and very ordinary. Like most people, they were nice. By the end of the evening they don’t have the energy to be pumping chloroform through my air vents. Not when they’re tired and Jimmy Fallon is on.

The more you meet different kinds of people, the more you are reminded that deep down we’re all far more alike than we are different. 

3. Coaching

You can hire someone to help you improve literally any aspect of your professional skills. There are plenty of paid (and free) programs online, and you can hire a coach to help you craft an amazing resume, develop your skill set around negotiation, or help you define your next steps to get to your dream career. Don’t make the mistake of believing there are no mentors out there. Go find some. Invest in yourself - the resulting skillset will be the biggest reward you can imagine. And the confidence you'll get from focusing on your strengths and building new skills won't hurt either.

4 Tips to Increase Your Happiness

People say you can’t buy happiness. In reality, that expression is only half right. For example, it’s physically impossible to frown while you’re on a jet ski. But despite what the ads promise us, buying products create happy moments but simply can’t create lasting happiness. Here are four things that can:

1. Giving to Others

According to research, giving as little as $1 away can cause you to feel wealthier. Across the 136 countries studied in the Gallup World Poll, donating to charity had a similar impact on happiness as doubling your household income did.

2. Spending on Experiences

Researchers found that over time people’s satisfaction with products they bought went down, while their satisfaction with experiences they spent money on actually went up.

It’s called the ‘Easterlin Paradox,’ and it means that money does buy happiness, but only up to a point. So when it comes to spending money, keep in mind that we forget products but remember experiences.

3. Seeking Fulfilling Work

The formula for finding your dream job is to build up the courage and save up the money to leave every wrong job you take first. You don’t have to be a jedi - we often only know a job is wrong for us by experiencing it firsthand. This is also true with what you think might be your dream job. Best thing you can do is try it and see. The best thing you can do to create mobility and flexibility and try on jobs till you find your dream version, is to save money. (Have another look at the tips that will buy you time.)

4. Making It Fun

Treating yourself isn’t about buying whatever you want whenever you want. Because if you were paying close attention while watching Parks and Rec (which gifted us with the Treat Yo Self meme), you noticed that it only happens once a year. Make shopping fun by making shopping an occasion. Cut spending in one area for a small, manageable amount of time, and then celebrate your success by indulging in that same area. Delayed gratification beats instant gratification every time.

Making it fun is the best philosophy I’ve found for saving money. In the book Happy Money, the authors cite a study where some students were offered a piece of chocolate immediately, while others were told they would get a piece of chocolate after they waited for a short period of time. The delay provided an opportunity for anticipation, and the students who waited were not only more likely to visualize eating it prior to consumption, they enjoyed it more. Despite this, students who waited failed to recognize the benefits that delaying provided. They didn’t feel that they had enjoyed the chocolate more, even though their brain activity told a different story. In other words, don’t trust your emotions or your drool response on this one – trust the science.

If you think about it, credit cards work the exact opposite way by design. They allow you to have whatever you want right away, only having to pay for it later. Scientifically, credit cards actually make it harder to enjoy your spending. Do you know what kind of cards are way better? Gift cards. 

When someone gives you a gift card, you’ll anticipate getting to spend it, which means when you do you’ll enjoy it more. It’ll even make you want to give one to someone else so they can have this feeling too. Maybe.

Find more tips, videos & brief-but-helpful guides on my blog!