3. Not Having A Stockpile (Buffer)
This prudent money habit relates to the first one on the list – pay yourself first.
By ensuring you consistently put money aside for your financial goals, eventually, you will build up a ‘money buffer’ that allows you to start building your wealth.
A financial buffer provides more financial freedom and allows you to start investing in projects, side hustles, or even education that provide high returns on investment.
You typically want to have a cash buffer that can help maintain your life for around 3-6 months should the worse thing happen and you lose your primary income source.
Should you lose your job or want to focus on a promising side hustle, having a buffer will provide you with the freedom you need to build other forms of income.
To start building a ‘money buffer,’ start paying yourself first and putting 10% of your earnings into a savings account every month.