Most people believe that the twenties are a time for being broke and having fun. But that attitude, can have some awful after-taste as you get older. We’re infamously called as the credit card generation and people love talking about our spending habits. We have a vast variety of shopping & food apps installed in our smartphones that notify us regularly about their offers & discounts which more likely tempts us to keep spending on those not-so-useful stuffs! This is because digital payments have made it a lot easier and made everything available at the tip of our fingers.
My Dad who earned success from nothing to everything, has admonished this one thing in my mind from the very beginning : “If you earn 100 bucks today make sure to save a minimum of 20 out of it. Living on a 80 won’t make you look any less opulent”.
However, we’ll discuss how money management is an acquired skill and the earlier you start the better you get.
Spend less than you make
Making a habit of living on less than you make will help you reach your financial goals much quicker and easier. If you get used to this early, it will get you in the habit of saving more and spending less, allowing you to save for big purchases— such as a house or car — and put more money toward your future plans.
Create a ‘Magical’ Bank Account
When I received my first paycheck, it was too exciting to have an independent account balance. But slowly realised that I didn’t have a track of my spends by the end of the month! That is when I opened two different bank accounts. One, where the salary would be deposited every month; another a manual savings account. I would take out half of what I earned from my Salary account and transfer it to my ‘Magical’ saving bank! So it’s good to learn the art of dividing your income in money management concept.
Have a track of your subscription charges
Subscriptions are deceiving because companies know it’s easy to get smaller monthly charges out of your pocket every month without you noticing. Try ditching your expensive subscriptions to save some extra cash. If you are still a traditional cable user, consider switching to a cheaper option like Amazon Prime or Netflix.
Make use of credit cards only if you have the confidence to repay!
Use a credit card for small purchases that you know you can pay off before the due date. The single most important thing about using a credit card is making sure that you always pay it off to a balance of 0 and on time every month.
We all have goals, either about careers, relationships or personal achievements. While finances might seem like the last thing we want to focus on in our 20s, investment habits that are inculcated earlier, can reward you with a stress-free financial life!
Disclaimer: The opinions expressed in this post are the personal views of the author. They do not necessarily reflect the views of Aweekinlife.com. Any omissions or errors are the author’s and A Week In Life does not assume any liability or responsibility for them.