Honest Advice to Young People Struggling With Finances
Most schools or colleges do not offer financial literacy lessons. This means that the younger generation is prone to making some costly mistakes, which some of us had to learn the hard way. I have always believed that personal finance should be taught in schools to prepare young adults for the demands that await them.
Personal finance is a broad subject. While most people think that it is all about managing incomes, it also touches on a host of other things such as credit application, debt management, and investing. From experience, the sooner one understands the principles of personal finance, the better. As well as checking out the helpful articles on sites like https://www.moneypeople.io/, here are some tried-and-tested practices aimed at helping young people transform their financial life from functional to impressive.
Track Your Finances
Youthful life comes with all manner of demands. The hustle and bustle of modern life make young adults susceptible to losing grip on their finances. While this is bound to happen, I wish that the young people might get their footing right before it is too late. Again, it is not just about making big changes; I believe that small continuous changes have the last say in your financial health. There are quite a lot of ways to reduce your outgoings. One of the methods to track your expenses is by keeping a daily budget of your expenditure. By doing so, you’ll have an idea of where to cut down and how to minimize your expenses.
Embrace Self Control
Self-control is a skill that only a few master. As much as one can afford all the fine things, embracing the fine art of delayed gratification goes a long way in saving the youth from making financial blunders. I honestly understand the plight of young people today, but the journey to financial freedom calls for serious sacrifices. For those who struggle with remaining true to their rules, I advise them to have someone hold them responsible for their actions.
Hire a Financial Planner
Most young people are unable to keep their heads up when managing their finances, and there is nothing to be ashamed of. We have all been there, and some things, such as mastering the art of managing finances, take time. For those who are serious about getting their finances sorted, a financial planner might come in handy. From my engagements with young people, I realized that most of them believe that financial planners are a preserve of the wealthy, a notion that does not hold. Any day, I would recommend a planner to any young person who wants to become financially secure.
Have an Emergency Fund
I usually advise the youth to “pay themselves first.” Talking about paying yourself, every responsible adult should work and plan for those dark days. And I also make it clear that setting up an emergency fund is not subject to their income or any other financial commitment. From a personal standpoint, I developed a habit of saving money and seeing it as non-negotiable expenses. And it only took me a few years before I had enough money to go for a vacation or make a down payment on a home, only to choose the former.
Getting rich takes time, except for the lucky few who are born with a silver spoon. In light of this fact, I usually advise young people to take it slow with investments. Lower yield investments make good choices for young people with limited capital. However, the key to making it big is to go all in on investing. As much as it is important to focus on wealth creation, I advise the youth to avoid falling for those get-rich-quick schemes.
I have always held the opinion that financial success is a personal prerogative. Notably, degrees and special education have nothing to do with economic prosperity. While life is all about learning, matters to do with personal finance require more than just knowledge.