International Women's Day 2024: 7 financial habits that will enrich your finances

Financial success varies from person to person. Whether you're looking to grow your career or increase your income, it's important to focus on managing your personal finances and making the most of what you have. Here are seven practices that have worked for me:

Prepare for unexpected situations

Make it a priority to have a safety net you can rely on. By creating an emergency fund for unexpected expenses and contingencies, you won't need to save long-term to get through life. Usually this will cost him 6 months to his year.

Don't invest in things you don't understand

Investing can be full of jargon, but you should fully understand the structure and nature of an investment before making a purchase. If some information is not transparent, it is best to avoid it. Ignore the fear of missing out on the next big Reddit investment craze and stick with what you understand and can work with. Consider working with an established financial advisor.Also read: International Women's Day 2024: Women breaking barriers through financial planning and empowerment

Get rid of negative feelings about money

Whether you associate financial ambition with greed or frugality with penny-pinching, it's important to let go of negative associations with money. Earning, spending, saving, and investing money are important parts of our daily lives. Developing a healthy outlook on money can make a big difference in achieving your goals in life, whether it's raising a family, buying a home, pursuing higher education, or just going on an adventure trip.

Not tied to fixed assets

The old concept that owning an asset such as a house or a car is the most important investment you can make needs to be removed. It's not realistic to be tied down to a location just because you bought a house, or to commit to repaying an expensive loan over a long period of time. To make the most of your opportunities and experiences, it may be better to rent. Alternatively, you can also buy in one place if you need to build up fixed assets but still choose where you want to live, considering that many professionals now have several options .Also read: International Women’s Day 2024: 7 steps to economic empowerment

let go of bad investments

Whether it's a promising stock that goes down or a physical asset that you never end up using, we've all made bad investments. Due to the sunk cost fallacy, you may have to continue with an investment that is losing money, which could result in even more losses. Learn when to cut your losses and move on. Otherwise, the wrong investments will limit your future possibilities.

Generate multiple income streams

Having multiple sources of income is critical to building wealth over the long term. Make sure that your alternative sources of income are set up in a way that they will continue to make money, even without your intervention. This can be done through a variety of investments, from mutual funds to rental real estate.Also read: International Women's Day 2024: How can women ensure long-term wealth creation?

promise to give

Once you have your finances in place, consider repaying a designated portion of your income each year. Whether it's donating to organizations active in social justice and welfare initiatives, or investing the time and money needed to care for underprivileged individuals and voiceless animals, choose what's right for you. Find something and stick to it every year, even if your circumstances change. Your investment may have gone down in a year. Continually putting empathy into action will help you stay grounded and make better choices for your financial freedom.

Hardika Shah, Founder and CEO, Kinara Capital