Ah, to be young – but there is definitely a downside. Being a newbie in this economy is not only scary, it’s also pretty hard to learn the best ways to do right with your money. Everywhere you look, you hardly see anyone else who knows what they are doing anymore.
You just need to learn it all on your own – invent your own rules – because this is one lesson everyone is learning now too. So think of your “lack” of knowledge in money management as an advantage, since you’re not an old bone-tired dog trying to learn new tricks.
Go ahead and sit down to make a budget, first and foremost. You don’t have to be ultra-perfect or even specific. Just being aware is often quite enough to set your spending straight. Speaking of being aware, one fantastic idea is to sit down every night and write down how much you spent that day. It might make your teeth grind. But that’s the whole idea, isn’t it?
To help you remember every purchase, mentally add up the total before you walk up to the register. Just that tiny little extra bit of effort will ingrain the number in your mind, and you will remember how much you spent with much more accuracy.
You may also want to consider going on “just cash” for a while too – especially if you live in a place where cash is still used. A debit card doesn’t provide very much protection if something goes wrong, especially since it is directly tied to your money.
A credit card can lead you into all sorts of trouble down the track. It’s why there’s almost $1Trillion in credit card debt in America. Almost everyone loses track of their spending and overdrafts when it comes to using the plastic fantastic.
Instead, keep your piece of plastic in a safe place and withdraw what you need once or twice a week just to get your financial muscles working.
Last but not least – definitely do put some money aside. I know you want the newest iPhone and that extra special sparkly whatever – but trust me on this one. In the future, when the injury happens, the car gets crashed, or you’re in-between jobs, you’ll wish you had that padding.