Clark Howard: 3 Savings Habits That Will Make You Rich

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If you want to get rich, it’s not just about how much you earn — it’s also about how much you save. Even with a relatively small income, like a teenager’s wages from a summer job, you can turn that into real wealth with patience.

In an episode of money expert Clark Howard’s podcast, he talked about some savings habits that will put you on track toward wealth. These aren’t overly complicated strategies — they’re foundational moves that help you build a fortune.

Start Early

The earlier you start saving money, the more time your savings have to grow and compound. Howard explained that he made his three children get jobs when they turned 15. At the end of the summer, regarding every dollar that the kids did not spend, Howard and his wife matched those savings — dollar-for-dollar — to put the combined savings and match into a Roth IRA for each of them.

By giving his children this head start, they already have substantial retirement savings, even though his oldest daughter is only 34. And even if you can’t match your children’s savings, the simple act of starting early provides a mathematical advantage.

Engage in Deferred Gratification

Connected to starting to save early in life is embracing deferred gratification. Both kids and adults face the challenge of wanting to spend money in the present, said Howard.

But if you can see how saving money now leads to greater rewards down the road, then it can be easier to make that short-term sacrifice. To accomplish this, Howard suggested setting goals and talking about what that money can achieve for you in the future if you set it aside now.

Investing for Everyone

If you know you want to buy a house, for example, and are clear about what you need to do to get there, then it can be easier to pass on buying the latest gadget and instead put that money toward your bigger goal.

Invest Your Savings

Lastly, it’s important to not just keep all of your savings in cash but actually invest it to gain more long-term growth and compound returns. While this was more so implied in Howard’s podcast, he mentioned how his kids’ Roth IRAs had aggressive portfolios.

If you have a long time until you need to access your savings, as is often the case with retirement savings, then you may be able to tolerate the ups and downs of the stock market, which historically trends upward.

If someone invested $100 in the S&P 500 in 1928, for example, that would be worth over $787,000 today, according to an NYU analysis. In other words, even with market crashes like those which occured during the Great Depression and the Great Recession, investing even small sums can result in substantial wealth, given enough time.

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