Habits That Boost Your Wealth-Building Progress

Emergency Fund

Rachel Cruze emphasizes the importance of building a robust emergency fund after clearing debts. She advises upgrading the initial $1,000 savings to cover three to six months of expenses, ideally in a high-yield savings account. This strategy ensures financial security and sets the stage for future investments.

After you save $1,000, once that's done, then all of your other money, any other savings that you have, that's not retirement. Any extra money that you have, I want you to throw it towards your debt.

--- Rachel Cruze

Rachel also highlights the significance of investing in personal education, suggesting reading books on money management and business to enhance financial literacy 1 2.

   

Saving Fun

Rachel introduces the concept of sinking funds to make saving an enjoyable experience. By setting aside a small amount each month for planned purchases, individuals can avoid debt and enjoy financial peace. This method allows for stress-free spending on big-ticket items like cars or vacations.

When it comes to making savings fun, that is sinking funds. Okay, sinking funds. This is where you save a little bit of money every single month.

--- Rachel Cruze

She contrasts this approach with the pitfalls of 0% interest deals, which often lead to unexpected debt, advocating for a cash-over-credit mindset 1 3.

   

Cash Flow

Rachel discusses strategies for enhancing personal cash flow and achieving financial goals. She suggests using money to "buy back time" by eliminating non-essential activities and focusing on income-generating pursuits. This approach can lead to significant financial growth over time.

The fourth thing that he recommends is to use money to buy back your time.

--- Rachel Cruze

Additionally, Rachel encourages diversifying investments beyond traditional methods, such as real estate or business ventures, to achieve quicker returns and build wealth 4 5.