10 Money Habits of the Wealthy in 2024

Want to get rich? These 10 Money Habits of the Wealthy, updated for 2024, are so easy you’ll automagically accumulate wealth on autopilot!

Originally published 15 August 2018. Updated 24 October 2024.

Money Habits of the Wealthy

1. Get Rid of Bad Debt

This is the first step in wealth creation. You must understand the difference between good debt and bad debt. Good debt might be…

A home mortgage
Student loans for valuable education
Business loans that help you earn more

But watch out for bad debt, e.g. credit card debt or buy-now-pay-later purchases. You need to clear these before you can start building wealth.

2. Make Smart Spending Choices

Always look for ways to spend less. Before buying anything, ask yourself…

Do I really need this?
Will it make me happy long-term?
Is there a cheaper option?

It’s okay to spend money on things that truly matter to you. The key to happiness is to skip the impulse buys and stuff that doesn’t bring long-term joy or value to your life.

3. Pay Cash for Big Purchases

Want something expensive? Save up for it until you can afford it instead of using credit. This includes cars and electronics. Yes, waiting is hard, but you’ll…

Save money on interest (lots of money)
Often get better deals when paying in full
Feel prouder of your purchase

Never buy anything on hire purchase or with a personal loan. Waiting until you have saved up for it is called delayed gratification. Forty years of Stanford research found that people with this quality are more likely to succeed.

4. Ditch the Credit Card

In 2024, there are many smart ways to pay without credit cards:

Debit cards
Digital wallets (like Apple Pay or Google Pay)
Payment apps (like Venmo or CashApp)

These let you spend only what you have, which means you’re not going into debt or paying interest.

One tip: If you must have a credit card, only use it if you can pay the full balance every month.

5. Buy a Used Car & Be Smart About Transportation

One of the best ways to throw money away is to buy a brand new car. A new car loses value fast – up to 30% in the first year! Consider these options instead…

Buy a used car (2-3 years old is often best)
Use public transport where possible
Try car-sharing services
Look into electric vehicles for long-term savings

Many millionaires never buy a new car because they know how much it depreciates as soon as they drive it off the yard.

6. Save Automatically

Set up an automatic transfer of at least 10% of your income into a savings account or investment fund. It’s called “pay yourself first“, and it’s one of the fundamental habits of the rich.

Doing this forces you to live on less than you earn. It’s a basic part of wealth creation.

In 2024, you can use…

High-yield savings accounts
Index funds
Investment apps
Retirement accounts

If you currently have a mortgage on your own home, pay that off first. You must do everything you can to pay it off as quickly as possible. See habit 10.

7. Pay Less Tax

Taxes are probably your biggest expense. You would be shocked at how much tax you actually pay. Hint: It’s more than just PAYE.

You can get a lot of legal tax deductions by having a home-based business. Even a side hustle.

8. Pay For Good Financial Advice

Find advisors who work directly for you, not for banks or investment companies.

If they’re paid by someone else, or get juicy commissions for what they promote, they’re not incentivised to look after your best interests.

Getting independent Wealth Coaching advice is a great starting point.

9. Keep Learning About Money

Make learning about money and investing a regular habit…

Follow trusted financial experts online
Read money blogs and books
Listen to personal finance podcasts
Take free online money courses

The more knowledge you have, the better your financial decisions will be.

10. Pay Off Your Mortgage Fast

If you have a mortgage, do all you can to pay it off as fast as you can…

Make extra payments when possible
Consider fortnightly payments instead of monthly
Use windfalls (tax returns, bonuses, salary increases) for the mortgage
Make short-term lifestyle compromises for long-term gains

Let’s say you have a 30-year mortgage of $600,000 at 6% interest. You’ll pay $695,029 interest over the term of your mortgage.

But if you increase your payments and pay it off over 15 years, you’ll only pay $311,365 interest.

You save $383,664 by paying it off quicker. Over a $⅓ million added to your long-term wealth!

That’s why it’s important to bite the bullet and pay down your mortgage as fast as you can.

Even if it means having local holidays instead of jetting off overseas. And yes, having scrambled eggs at home instead of smashed avocado on sourdough with an oat milk latte at a cafe.

Once you’re mortgage-free, you can divert your mortgage payments into investments instead.

BONUS HABIT…

11. Use Dollar Cost Averaging

Want to know how the wealthy build their investment portfolios? They don’t try to time the market – they use dollar cost averaging instead. It’s their secret wealth-building weapon.

Dollar cost averaging is a wealth-building strategy that dates back to 1949, when legendary investor Benjamin Graham first revealed it in his book, The Intelligent Investor.

The strategy is simple but powerful…

Invest the same amount of money every month
Keep doing it whether the market is up or down
Increase the amount as your income grows
Automate it so you never miss an investment
Let time and consistency work their magic

Here’s why it works: When you invest the same amount each month, you automatically buy more shares when prices are low and fewer when they’re high. Over time, this leads to a better average purchase price than trying to time the market.

Let’s look at a real example. You invest $500 monthly in an index fund…

Month 1: Share price = $5.00 → Gets 100 shares
Month 2: Share price = $2.50 → Gets 200 shares
Month 3: Share price = $4.00 → Gets 125 shares

The Wealth-Building Power? Once you’ve crushed your mortgage (see habit 10), rich people redirect those payments into a dollar cost averaging strategy.

Imagine turning your old $3,500 monthly mortgage payment into a wealth-building machine!

The wealthy get rich steadily and systematically, letting strategies like dollar cost averaging work for them over time.

Want to really accelerate your wealth? Combine this with the other 10 money habits of the wealthy and you’ll be well on your way to financial freedom.

These are the money habits of the wealthy. Remember: It’s not about getting rich quick; it’s about being consistent. The money habits of the wealthy have a compound effect over time to help you build lasting wealth.