Last week a friend and I were discussing about money management. Some people could handle it well, while some could not. The ones who could manage their finances well could control their lives, while some others are continually struggling to get out of their bad loans — no matter how much money they earned.

Financial freedom can be achieved by anybody, regardless of their income level. So, what separates the financially free from the financially inept? How come there are some families out there making ends meet with household incomes under ₹50,000 and no debt on the books — or at worst, a single house loan payment — while others make millions per year and can’t keep their financial heads above water?

The truth is, there is no single trait that differentiates people who manage their finances successfully and those who don’t. People of modest means who know how to properly manage their finances have some combination of multiple characteristics. Here are top ten of the many:

1. They’re detail-oriented

Such people keep a close watch on their money to keep themselves in a better financial position. They keep track of their savings, spending, salary and where every rupee is being spent. Since they are aware of their financial situation Because they’ve got a good handle on the state of their personal finances, they’re less likely to buy something they can’t afford.

2. They realize debt is future killer

Debt is a huge burden that kills our future aspirations in exchange for instant gratification. Financially stable people understand that, in most cases, such a trade is like bargaining for your soul with the devil. Ok, not that extreme.

3. They’re pragmatic

Most of the debt-free people are practical and they understand the meaning of value. For them it is about real worth of the purchase they have made. For example, they tend to look at cars as merely a means to get from point A to point B — so they’ll refuse to buy expensive cars.

4. They understand that credit cards are a double-edged sword

People who are in control of their personal finances aren’t afraid of credit cards. In fact, they embrace them as they know what are the pros and cons of using a credit card each month. This knowledge fosters a healthy respect that keeps their credit cards from being abused.

5. They’re self-reliant

Most people who work hard to maintain a life of financial freedom take pride in being self-reliant. They live within their means and save as much money as they can for rainy days and lean times.

6. They are not shopaholic

A lot of people get a high from spending money — whether they have it or not. Financially stable people control their shopping habits.

7. They’re patient

Debt free people don’t achieve that state because they’re impulsive shoppers, or looking for instant gratification. If the money for something isn’t available, then they save and wait.

8. They’re self-confident

Financially free people never let their self-worth be defined by their possessions. They understand that their status in life is more accurately conveyed by self-confidence, rather than deceptive displays of wealth.

9. They believe in personal responsibility

Financially responsible people refuse to make excuses. They know it’s their responsibility to put aside funds for unexpected events such as a job loss or unforeseen accident — and if they don’t, they’ve got no one to blame but themselves. They also understand that living within one’s means goes a long way towards ensuring their ability to control their own destiny.

10. They’re not materialistic

Yes, the pursuit of expensive toys and other possessions can make life more luxurious. But at what cost? Debt-free people understand this; hence they believe in simple living that focuses on the joys of family and life experiences, rather than the accumulation of material possessions.

However, the more of these characteristics a person possesses, the more likely they are to be financially free. How many apply to you? Do you know any do tell me.