Following smart financial practices is essential for accumulating wealth.
Michela Allocca, a former financial analyst who amassed a net worth of over $500,000 by age 28, as verified by CNBC Make It, is well-versed in this. In 2022, she shifted from her corporate job to focus on her side hustle as a personal finance coach.
Her TikTok video, which has attracted nearly a million views, provides insights on how to build wealth based on her own experiences.
Here are the five spending habits she actively avoids:
- Steering Clear of Sales
Though sales may appear to be opportunities for savings, Allocca cautions that they often tempt people into buying things they don’t really need. She points out that sales typically create a sense of missing out, encouraging unnecessary spending.
Allocca believes that even buying an item you don’t need on sale is still spending money you hadn’t planned to. She does buy essentials on sale but makes sure not to overspend on other items.
- Avoiding Impulse Purchases
A 2023 study shows that nearly all American adults engage in impulse buying, with 64% regretting such purchases later. Allocca combats impulse buying by listing items she wants on her phone and giving herself time to think about the purchase.
She recommends waiting a bit before buying something on impulse, as the urge usually fades away with time.
Allocca stresses that not every small purchase can be justified as a treat, emphasizing the importance of spending discipline.
