Your everyday money habits could be quietly sabotaging your path to wealth — but you can change them. In a YouTube video, Nischa, a former investment banker turned financial influencer, broke down three common habits that hold people back and how to fix them.
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Here are the habits Nischa said you need to break to start building real wealth.
Paying Yourself Last
The No. 1 mistake most people make is not automatically dedicating a portion of their paycheck to savings.
“Most people pay for their social plans, their dinners out, their holidays, their iPhone upgrades and then save what’s left,” Nischa said. “Instead, pay yourself first. Take 10% minimum from every paycheck and put it in your pocket first. Make yourself rich before making other people rich.”
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Not Having a Budget
Many people don’t track their income and expenses. If you don’t have a clear view of your current financial situation, it’s nearly impossible to improve it.
“Those who know how much they make and spend are far more likely to gain wealth than those who just fantasize about money and have no clue about where they stand,” Nischa said. “Start with categorizing how much you’re spending into your fundamental costs, your fun costs and your future you costs.”
Not Understanding Your Taxes
Many people just see the taxes they pay as a given and don’t take the time to be strategic about finding ways to reduce them.
“Taxes are going to be the single biggest expense of your life,” Nischa said. “The best thing you can do to get ahead is to understand basic tax rules and use them to legally work in your favor.”
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This article originally appeared on GOBankingRates.com: Former Investment Banker Shares 3 Costly Money Mistakes
