Building wealth doesn't happen overnight. It’s a process that involves consistent effort, long-term planning, and, perhaps most importantly, strong habits. James Clear’s book Atomic Habits provides a framework for developing those habits, and this episode of the Get Rich Slow Club podcast discusses how they could apply to your financial journey. Whether you're new to investing or already building your portfolio, forming small, sustainable habits is key to building wealth slowly.

When it comes to wealth, tiny daily actions can compound into substantial financial success over time. Ana and Tash have seen firsthand how minor tweaks in behaviour could lead to major results. As Ana says: "Small things that we do can actually have a huge impact on our finances."

But how do you start incorporating habits into your financial life? Well, according to the principles of Atomic Habits , one of the best ways to do so is by making good habits easy and bad habits hard.

Creating friction to reduce spending

If you want to control your spending, create obstacles – or what James Clear calls "friction." The idea is simple: make it harder for yourself to spend money on things that don’t align with your financial goals . One of Tash’s favourite examples of this is cancelling her credit card every year, which forces her to reconsider which subscriptions she wants to keep.

“I found this has been really good for trying to get rid of subscriptions," she explains. "Because once you cancel your credit card, you have to be really intentional about what you're going to actually sign up to again."

This method isn’t just limited to subscriptions. You can apply friction to impulse purchases, too. Tash suggests deleting your saved card information from your phone or laptop. If you’re forced to manually input your credit card details every time, you might think twice about hitting “purchase.”

Ana shares another friction-based strategy for saving : “I would put my savings in a completely different bank where it was inaccessible... I would also delete that bank's app off my phone.”

By making it more difficult to access your savings, you may be less likely to dip into them for unnecessary expenses. This can allow your savings to grow, undisturbed by spur-of-the-moment decisions.

Automate your way to wealth

While friction works to prevent bad habits, ease is what makes good habits stick. Automation can be one of the simplest and most effective ways to help you stay on track with your financial goals. Tash and Ana both automate their savings and investments .

“I’ve automated my investing for years now,” Tash says, “It’s great. I don’t need to look at it... and I can’t keep putting it off because it’s just done for me.”

For those who are just starting, micro-investing can make the process even simpler. Ana highlights a strategy called rounding up, where everyday purchases are rounded to the nearest dollar, with the spare change invested.

“Let’s say you're spending $4.50 on a coffee," Ana says. "That 50 cents gets rounded up to $5, and you just have 50 cents that went into investing.”

Over time, given the right market circumstances, these small amounts could grow into something much larger.

The power of incremental improvement

One of the core messages of Atomic Habits is the idea of becoming 1% better every day. This principle applies beautifully to personal finance. If you focus on improving your financial habits by just 1% every day, you may see significant progress over time.

Ana brings up a crucial point.

“Is there something that you can do at work so you can be a 1% better, 1% more efficient employee? That can translate into a higher income. It compounds and it compounds over time.”

Incremental improvements in your job performance not only lead to skill development, but might also raise your chances of earning more, whether through promotions, raises, or job changes.

The compounding effect isn’t limited to the workplace. As Tash points out, even small changes to your lifestyle or fitness routine can add up.

“I used to get obsessed with something, do it six days a week, and then I’d hate it," she says. "Now, I’ve found having the bare minimums is a lot more achievable."

Habit stacking: the ultimate hack

In Atomic Habits , Clear talks about the idea of “habit stacking” – pairing a new habit with an existing one. This is a great way to build financial habits into your daily routine without adding any extra effort.

Ana shares how she uses this technique in her life.

“I track my net worth and I track my finances, and when I do that, it makes me also look at my budget," Ana says.

"It allows me to be aware of my whole financial situation.”

Tash highlights another example.

“I like to read my book on the treadmill. I get absorbed in the book and forget that an hour has gone by, which is great.”

By combining two habits, Tash is able to stay consistent with both her fitness and her reading.

You can apply habit stacking to your finances by linking money-related tasks with daily routines. For example, you could set a reminder to check your bank balance right after you make your morning coffee or review your budget while you wait for your dinner to cook.

Surround yourself with the right environment

Your environment plays a significant role in shaping your financial habits. As Ana notes: “It's easier to start new habits when you're in a new location.”

If you’ve ever moved to a new neighbourhood and found yourself spending more (or less), it may be because your surroundings can either facilitate or hinder certain behaviours. If your goal is to spend less, it may help to live somewhere less commercial, where you’re not constantly tempted by cafes or shops.

At work, too, the environment matters. Many people develop a habit of buying lunch daily, which adds up quickly. Breaking this habit might require a change in environment – like bringing lunch from home and eating somewhere away from restaurants and cafes.

Celebrate your wins (no matter how small)

One final takeaway from Atomic Habits is the importance of celebrating your successes. Ana suggests keeping track of your financial milestones, even if they seem small.

“I love actually writing things that I've accomplished for the year, even if they're small, just so I can celebrate them,” she says. Reflecting on these wins can boost your motivation and remind you of the progress you’ve made.

The journey to financial freedom isn’t a sprint, but a marathon. By embracing the principles from Atomic Habits , you can create a sustainable path to wealth, one small step at a time. So, start building those habits, celebrate your wins, and remember that even slow progress is still progress.

If this episode sparked something in you, give it a five-star rating, drop a review, or better yet, share it with a friend. And if you're just starting out, the first ten episodes will get the financial gears turning. Follow us at @getrichslowclub and catch our personal updates at @tashinvest or @anakresina.

Happy investing!