The 3 Key Habits to Become a Successful Investor and Grow Your Wealth

There are 3 key habits you need to begin your investment journey and grow your personal wealth. They are an important first step to get started in property or other investments and to monitor your progress. I have adopted these habits over a number of years and continue to regularly review my own personal financial situation.

1) Spend Less Than You Earn

Unfortunately you can’t invest if you don’t have any money! You will need to save up and there is really only one way to do this – you need to earn more money than you spend on a regular basis.  Once you have excess funds available, you can allocate these to your chosen investments.

2) Track Your Monthly Expenses

If you are struggling with Step 1), then Step 2) is the best way to take control of your finances and see where your money is going each month. Categorize your spending into simple groups (e.g. rent/mortgage, supermarket, eating and drinking out, entertainment, holidays, sport and fitness, other personal expenses and “miscellaneous” for those that don’t fit anywhere else!)

Once you make it a habit of doing this on a monthly basis you will find it becomes quite easy and it doesn’t take too much time. Often you will find you are surprised at the results and how much you spend in particular areas. You will then be able to get an accurate picture of your spending habits, and make the necessary adjustments if you want to save more money and start investing. 

There are a couple of ways to track your expenses - you can export your credit/debit card statements from your online banking account and then use a simple Excel spreadsheet (currently my preferred method). There are some example spreadsheets/formats online – generally you will want to try a few different templates to find out what works best for you (simple is better!). Alternatively some banks have built-in financial planning systems attached to your online banking account or there are a number of websites that provide budgeting and money tracking tools.

3) Track Your Net Worth

Your net worth is defined as the number of assets you own minus the number of liabilities you owe.

An asset is a resource with economic value. In investment terms it can be thought of as something that makes you money. Examples are a business, property, cash, shares.

A liability is a debt or obligation. In investment terms it can be thought of of something that costs you money. The most common example is a monetary loan – things such as a mortgage, student debt, credit card debt or personal loans.

In general, you want to increase your assets and decrease your liabilities. There are some items that are “grey areas” such as a car. Whilst a car has value and can be sold for money, it also costs you money each month to run. So this could be classified as either an asset or a liability.

By tracking your net worth on a regular basis (I do it monthly to line up with my expenses), you can monitor your progress and set financial goals. A consistent increase in net worth indicates good financial health. If it is decreasing or remaining stable, you can figure out why and make some adjustments to get back on a positive track.

Add up all your assets and all your liabilities and work out the difference. Again, a simple spreadsheet is the easiest way to do this – I personally use Numbers on Mac which has some great templates. It may be negative initially as you may owe more money than you own! When I started doing this a number of years ago I was in the “negative net worth” territory. As I slowly made changes, my net worth increased - starting is the most important part!

By adopting these 3 key habits, you will have taken an important first step to beginning your investment journey, growing your wealth and achieving financial freedom!

If you want to get in touch, please send me an email:

micahkg@gmail.com