5 Habits Guaranteed To Build Wealth, According to Rachel Cruze
Written by
Ashley Donohoe
Edited by
Jenna Klaverweiden
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U.S. Census Bureau survey data from November 2024 showed that American households had a median wealth of $176,500 in 2022. But for many families, rising expenses, burdensome debt payments and income challenges make it hard to get by or save at all, let alone build substantial wealth.
In a recent YouTube video, money expert and author Rachel Cruze discussed how five simple habits helped her become a millionaire. Even if you don’t have a penny saved yet, you can adopt these habits to start building wealth today.
Live Without Debt
Cruze discussed how her parents stopped including debt in their lives after they filed for bankruptcy. As a result, she grew up not viewing debt as something normal and learned not to spend more than she brought in each month. This approach is key to building wealth.
“When you live a debt-free life, you’re not paying payments and taking your income, and instead of paying a bank payments, you could be investing that and making you and your family money off of those investments,” Cruze said.
To stop being held back by debt, commit to not taking on more and come up with a payoff plan for your existing debt. Cruze recommended the debt snowball payoff method, where you throw extra cash toward your smallest debt balance and move on up from there.
Live Below Your Means
Out-of-control spending can get you in trouble with debt and leave nothing to save, so living a realistic lifestyle for your income level is crucial.
Cruze recommended having a budget with practical spending limits for your expenses. She also suggested including categories for your emergency fund, sinking funds (for major or irregular expenses) and investment contributions.
Also, avoid lifestyle creep, which a Ramsey Solutions blog post described as increasing your lifestyle when your earnings increase. While buying a shiny new car to celebrate your promotion might seem thrilling, remember you need to put your extra money toward building wealth.
Avoid Comparison
Not only can seeing people live exciting, flashy lives on social media leave you disappointed in yourself, but it could also lead to money decisions that prevent building wealth. Cruze advised focusing on doing what’s best for your life even if it’s not what those other people are doing.
“When you do look different, we find you actually are probably doing better financially than the person that looks like they’re doing so great,” she said.
You don’t need to waste money on unnecessary stuff to impress people who might really be stuck in debt and unhappy. Keep your wealth-building goal in mind and practice contentment.
Clever Girl Finance recommended making financial plans that work for your own goals, avoiding social media and being grateful for what you have to avoid comparing yourself to others.
Invest In Your Future
Cruze discussed how consistently investing your money to get compound interest over time is a successful strategy for becoming wealthy. According to her, this can be as simple as maxing out your Roth IRA each year.
To show how much your cash could grow, Cruze gave an example using the Ramsey investment calculator. If you started with $0 at age 37, invested $600 monthly and got a 10% annual return, you’d have around $1.1 million by age 65. Over $800,000 of that is from interest.
While you can begin investing regardless of your age, starting earlier maximizes your potential to grow your wealth through many more years of returns and contributions.
Have a Long-Term Mindset
“There’s a level of instant gratification that a lot of us just live in, and over time, you end up spending so much money on that — it doesn’t even make you happy long term,” Cruze said.
If you make unnecessary purchases for emotional reasons, it will be harder to build wealth. Instead, focus on being patient and making decisions that align with your long-term goals.
Cruze discussed how she and her husband saved money for several years to get a pool for their home. While the process required patience, Cruze felt satisfied after achieving that big goal, and she didn’t have to turn to debt.
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