Becoming rich doesn’t usually happen overnight. If it does, then it usually doesn’t last very long. The main reason this is true is because in order to become rich and have wealth that lasts, you have to have a certain amount of financial discipline over a long period of time.
Financial Discipline Matters
I’m sure you’ve heard stories about lottery winners and trust fund kids who stumble unprepared into sudden wealth, only to lose it all within a few years. It’s a pretty common theme that you see time after time.
This tends to happen in those situations because there is usually one thing missing, and that is financial discipline.
Discipline Makes You Rich
One common theme you’ll find among rich people who keep their wealth and continue to build wealth year after year is that they have made it a habit to practice principles of financial discipline in their daily lives.
Unlike the average person who is living paycheck to paycheck, people that practice financial discipline have a much higher likelihood of ending up rich because of their consistent use of good habits.
There Are No Secrets For Getting Rich
Before I cut loose with the list of financial discipline tips that the title promises, I thought it would be a good idea to let you know that there really aren’t any deep dark secrets for becoming independently wealthy.
For the most part, financial discipline is about using common sense as a daily habit over many years. This allows you to build wealth and get rich one day at a time, month after month, year after year, leaving a legacy of good financial habits and generational wealth that lives on well after you're gone.
Building wealth is not a sprint, it’s a marathon, and when you practice the financial discipline tips you find below over a loooong period of time, you will win with money, period!
9 Financial Discipline Tips That Will Make You Rich
So… on with the show! If you would like to add any tips for creating financial discipline that you don’t see here, be sure to leave a comment with your tip on our Facebook page.
Choose a Career You Love
Working in a career you love increases your earning potential. The more you love what you do, the more effort you tend to put into it. The more effort you make, the more you tend to be rewarded financially.
Wasting your time and effort in a career you hate is a recipe for disaster- even if it pays well. It can ruin your health, kill your attitude, and make you not want to work as hard as you otherwise would. The result is usually less money over a long period of time, not to mention more health problems, stress, and general unhappiness.
Invest Your Money at a Young Age
Developing financial discipline at a young age is key. One of the best ways to exercise that discipline at a young age is to start investing your money as early as possible.
The most powerful thing you can do financially is to let the power of compound interest work for you over a long period of time. Every year you wait to invest costs you potentially hundreds of thousands of dollars at retirement. But don’t let that be an excuse if you’re getting a late start with investing. Investing right now is always better than starting tomorrow.
The best way to use financial discipline for investing is to have a percentage of your pay automatically deducted from every paycheck and deposited into your 401k, IRA, or favorite investing app. When it’s automatic you don’t have to think about it! This good financial habit builds your wealth like nothing else!
Managing your investments (and everything else financial) is easy with Personal Capital. Powerful tools to make your money work for you! Learn more about Personal Capital here.
Live on Less Than You Make
It makes a ton of common sense, but most people don’t do it. Having financial discipline means living below your means and not overextending yourself like most broke people consistently do.
You can do what I do and live paycheck to paycheck (the good way!). It’s a financial discipline tip I won’t get into here, but you can read about it at the link below.
Avoid Debt Like the Plague
Living without debt definitely takes financial discipline, but I can tell you from personal experience that it’s one of the best things you can ever do financially to become more successful than most people. Debt sucks you dry financially, costing you thousands every year in interest and fees that could be going into investments.
Don’t let your money go down the drain every year. Stay away from all consumer debt like credit cards, car payments, and other consumer loans.
Use a Budget Religiously
Good financial discipline means always having a plan for your money. Having a plan simply means doing a budget every single month and sticking to it.
Most people look at a budget as a tool for deprivation. But at its core, a budget is simply a tool for telling your money where to go so it’s used as efficiently as possible. When you use a budget to eliminate financial waste, you have more money to spend and invest for the future. You will never spend more than you make so eventually you’ll have the rich life you want.
I’ve written a lot of great resources on budgeting, which you can find below.
Always Pay Yourself First
Most people pay the bills first, and if anything is left to put into savings, maybe they will put it there. That’s not a good way to develop financial discipline.
When it comes to your hard earned money, no one deserves to keep it more than you. Making sure that you and your family are the first priority before you pay the bills is essential to winning with money.
As I mentioned above, have money automatically deducted from your paycheck to be invested in your 401k, IRA, or Roth IRA. That way you will invest money every single time you get paid instead of just occasionally. Becoming rich happens through being consistent and disciplined, and paying yourself first through automatic investing is a great tool to get you there.
Be a Giver
Ok, so I lied about paying yourself first. Actually I think it’s best to pay God first. As a tither, I can tell you that the financial discipline of giving and tithing are intimately tied to building wealth.
I know, it doesn’t make mathematical sense to give a portion of your money away and somehow expect to be richer because of it. But that’s exactly what happens when you make the commitment to tithe 10% of your earnings like God’s word teaches!
I’ve written many articles on giving that explain it much more in depth than I can do here. You’ll find a complete list of those at the link below.
Educate Yourself About Money
Developing financial discipline is one of those things that should always be at the top of your priority list. One way to develop that discipline with money is to learn as much as you possibly can about it.
You should keep yourself educated about how to use money wisely, how to invest your money, how to make a financial plan, how to spend money wisely, and how to grow your wealth. The more you know about money, the better off you will be when you put your knowledge into practice.
I recommend reading books and blogs about money, watching videos, and investing in courses.
Live Like No One Else
Some say rich people are different than the rest of us; I think I would have to agree. Building wealth and becoming rich take skills and financial discipline that most people just aren’t willing to develop.
Rich people get that way by thinking and acting differently on a daily basis for many years. While everyone else is spending money on car payments and credit card bills, those with financial discipline are using the tips above to separate from the crowd and become successful with money.
As Dave Ramsey says, live like no one else now, so later you can live like no one else!
Financial Discipline Will Make You Rich
Have you ever known someone who totally lacked discipline? What were they like? Were they sloppy and unkempt, or were they well-groomed and nicely dressed?
Having financial discipline in your life works much the same as having discipline in any other area of your life. The more discipline you have with money, the more money you will have.
It’s that simple.
You won’t develop a high level of financial discipline overnight. But when you continually work at it and do what it takes to develop more financial discipline in your life, you will eventually see the massive result of your efforts and be the richest person you know!
Question: Did I miss any of your favorite financial discipline tips? Leave a comment on our Facebook page and add your favorite.