People are not always what they appear to be, right? Sometimes the person with the pricey new sports car is ruining their credit and accruing deep debt. And the person who lives in a nice but modest home may be a long-term saver who has seven figures in their bank account.

Don’t judge someone’s financial health solely by their material belongings or their income. Look at their habits. In general, being financially fit means having the money you need when it’s needed, with plenty leftover as cushion for the future. Here’s a list of habits that are commonly practiced by those who can call themselves financially fit.

1. Save and Invest Early in Life

Take advantage of employer’s savings plans like a 401k and company matches. Set aside at least three to six months’ salary as an emergency fund if you lose your job or encounter an unexpected life expense.

2. Don’t Carry Credit Card Debt

Reports vary that the average American carries $5,000 to $10,000 in credit card debt. Of course, many carry higher credit card debt. Interest rates on credit cards can sky rocket after introductory periods. If you only spend what you can afford, then you’re able to save that extra 15-18% you’d otherwise be spending on interest payments.

3. Own a Home and Car That Leaves Room to Save More Money

Say a family can afford a $400,000 home yet chooses to buy a $300,000 one. Not only are they saving $100,000 in principal costs, they’re saving thousands in annual interest payments. If that family stays longer than five years in their home, they’re building more equity in their asset, meaning they can keep more of what it’s worth when they sell. And since cars depreciate in value quickly, it makes sense to keep one’s transportation on the practical side.

4. Minimize Recurring Expenses

Subscription services might seem like small expenses until you realize how many of them you carry. Multiple television service providers, phone providers, and app subscriptions add up. Habits like eating out more often than cooking also contributes to thinning your wallet. Financially fit folks keep track of recurring expenses and actively seek how they can save more.

5. Plan Ahead

An affordable portion of income should go to the future. Always. Whether it’s planning to afford a home, a college education, or a trip around the world, sacrificing certain wants today to achieve longer-term goals helps grow wealth. This means save wisely and spend judiciously.

6. Protect What You Have

The financially fit realize that anything can happen at any time. It doesn’t make sense not to protect what you have. Always protect your health, home, cars, and other assets with insurance.

Platinum Service Realty