Score more than 12 and you're on your way to being financially free (16 Questions with 1 point per question). Good luck 

 Do you save money almost every month? 

You should always put money in savings no matter what salary you make. The major reason why wealthy people are wealthy is because they save first then spend what remains. This is their habit. 

It has been found that those who are not wealthy generally try to spend their money first then save what is left.

 Do you invest at least some of your money directly in the stock market now either through individual stocks or managed funds? 

An interesting study was done comparing an investor who deposited $1000 into cash verse $1000 into ANZ shares back in 1993. 

Since 1993 the investor with cash has earned approximately $1000 in interest and is receiving about $50 per year in interest. Today their investment is valued at approximately $2100. 

In comparison the investor who bought ANZ shares has seen their investment increase to over $6,000, and is receiving a further $250 per year in dividend distributions. 

This is because the person who invested into ANZ shares has purchased a part ownership in a financial

company with an increasing dividend payment.

 Do you shop before you buy most of the time, especially for big-ticket items? 

We have all heard the saying "penny wise and pound foolish".

The fastest way to erode your savings is through impulse purchases. 

A great way I have found to make purchases is assessed what I want first then save up for it in cash before I make a purchase. 

This approach tests me on how much I really want the product and its keeps me out of debt when purchasing these luxury non investment items.

 Do you take care of your home or apartment, performing regular maintenance as well as repairs? 

If you take care of what you own it is amazing how long things last. 

In the long run taking care of what you own will save you time and money that can be used for other wealth creating investments.

 Do you perform regular maintenance on your car and otherexpensive items? 

See above. 

If you are taking care of your car not only will you reduce the chances of you breaking down at an inconvenient time, the car will also have better resale value when you decide to sell it or upgrade it.

 Do you pay off the full balance on your credit cards each month? 

Credit cards are one of the most inexpensive loans I am aware of. 

My issue with credit card debt is generally it is not used for investment purchases therefore interest on these purchases are not tax deductible.

This has even a great impact on cash flow as you first must earn income pay tax on it then payoff the credit card debts. 

For example if a current credit card rate is 16% and you are earning a salary in the 40% marginal tax rate the true cost of credit card interest is in fact 40% higher than that 16% interest rate. In pre-tax dollars the true interest rate is therefore 22%.

No wonder people with large credit card debts feel like they are going backwards.

 Are you comfortable buying used big-ticket items such as cars and appliances?

When purchasing a car from a car yard then the driving it off the block we all know the car depreciates by at least 5% to 10%. 

So next time when looking for a car or other big-ticket items you may wish to buy something six months old, or a demonstration vehicle. While doing so you can save yourself thousands of dollars. 

For example recently I went to a car yard and looked at the new Saab this was going to cost me $77,000however if I was to buy the same car six months old or a demonstrator I found I could buy the car for $69,000 saving myself $8,000 of my own money that I could use to reduce my mortgage. 

My investments would have had to work much harder to generate that $8,000 then I could get with the savings in buying something slightly older.

 Have you ever started your own business? 

I have found that people who are by nature high achievers generally want to be rewarded uponaccomplishment not seniority conforming to today's business world. 

They also believe they can improve the experiences for those around them and better serve the community with all through their skills. 

People who start their own business also love to get emotionally and physically involved in something that they are passionate about in this they take ownership and responsibility. 

Generally those who begin their own business love to win as entrepreneurs are the ultimate achievers. Being involved in any way with the new company is just plain fun. It's satisfying and exciting. 

Generally entrepreneurs spent more hours at their job than anything else than they do; it and they love to see the results of their hard work paid off.

 Have you ever estimated how much money you would need in a portfolio to produce enough income to cover your current living expenses? 

If you don't know where you're going

 • How can you set your goals you want to reach?

• How will you know when you get there?

• When will you know when enough is enough?

• How will you know if you are short or above? 

Knowing how much money you would need in a portfolio to provide feed your living expenses is a central win beginning to take responsibility of your future.

 Do you measure the performance results of your portfolio at least each quarter? 

While I enjoy reading charts (for confirmation of views) and hearing media headlines (I call it financialpornography- or a sugar hit) we don't have to watch the share market every minute of every day. 

However it is important to take a regular active interest in the performance of your investments so to takeadvantage of any changes of trends.

 Do you maximise your personal contributions to your superannuation? 

Regularly salary sacrificing or making additional contributions into your superannuation is a fantastic way to grow your wealth over the longer term. 

Superannuation in Australia is most tax effective and due to the time invested before you can access yourmoney you can generally benefit substantially from compound of interest on your money is. 

Recent changes to Australian superannuation laws mean that after 60 you can now take out your money from superannuation tax free. 

This change makes superannuation a fantastic vehicle to invest in.

 Is your mortgage payment less than 30% of your total gross household income? (If you do not own a home, is your rent less than 30% of your total gross household income?) 

Although home ownership is something all of us aspire to it is vitally important not to over commit yourself to servicing debts on your investment. 

The reason for this is simple if all of your money is going into paying off debt you do not have spare money is available for building long-term capital growth from other investment and asset classes. 

In other words you are am able to diversify and unconsciously putting all of your eggs in one basket. 

The solution to this concerning problem for me is for people to save more of a deposit before they enter into the residential property market and once they do not two over commit to excessively high mortgages.

 Do you spend less than you make? 

This may seem like a fairly obvious question when talking about what creation. 

However maybe the question could have been better worded to be. "Do you know how much you spend and how much you earn?" If you don't know the answer to this then you won't be able to answer this first question.Knowing your income and expenses is vital when wanting to build your wealth. 

Cash flow is the fuel that runs your wealth creation vehicle; you need to know that you have continued fuel to put into your engine so you can reach your destination.

 Have you ever read a book about building wealth or anautobiography about someone who was wealthy? 

One of the most important investments you can make in life is to invest in yourself.

The fastest and easiest way to learn how to create wealth is from those who have already created it.  

From them you will learn what to do and what not to do which could save you from financial disaster.  

If you haven't read a book yet about building wealth I encourage you to do so.

 Do you have your own business now that produces a positive net income? 

Four out of five businesses fail within the first year. 

Of the one out of five that survives four out of five of these businesses fail year two. 

Four out of the five that survive year to go on to be businesses that operates successfully over the next 25 to 30 years. 

So getting though the first 2-3 years in business is critical (by statistics) if you want long term success.Also in business cash flow is the lifeblood. 

Generally speaking business expenses should only be 40% of turnover with the balance going to the owner as remuneration/reward for their risk. 

If you would like your business to survive long-term and flourish you need to have a business that produces a positive net income.

 Have you ever worked all night or more than 24 hours on a project? T

his is an important personal attributes to have in becoming wealthy as it reflects a person's passion andpersistence and a reflection of their designer and commitment to see results from the reference.

See when you are genuinely passionate about what you are doing time is something that you forget about as you more focus on the result. As you stay committed to your achievement of your goal who also builds characteristics of assistance and these are vital elements you require when building wealth. Now go to sleep if you’ve been up for the last 24 hrs or more J 

Time to calculate your score.__/16 How did you go?  

Congratulations if you achieved over 12. If not begin to focus on the areas you didn't score .

Remembers it's about working and improving your weakness not you strengths that make you a more successful individual. 

Till next time I'm Peter Horsfield