Beth Kobliner, author of the New York Times bestseller Get a Financial Life, said,
Look at the mortgage crisis and how many families lost their homes — 3.9 million foreclosures. Look at the amount of money — $1.1 trillion—we owe in student loan debt. The amount — $845 billion — we owe in credit card debt. It’s pretty clear that adults don’t know much about money. To help the next generation avoid the mistakes of their elders, and to live financially fit lives, they need to be taught the essentials about money
There are many other financial experts, who admit the same statement that, everyone should get financial lessons at their early age. As per the survey, it’s seen that, those who have less money worries, get financial lessons at their initial stage of life. Even I have no problem to declare the fact that, almost 12 years ago when I first started dealing with finance, . Of course, that time I didn’t consider them as mistakes. Like my parents, many of you’re still not serious about your child’s financial literacy. As I’ve gone through many financial problems from my college days, I can say, not giving proper money lesson at early age is one of the biggest reason that most of Americans are still struggling with financial crisis.
Here, my article is all about some basic financial lessons I wish I knew at my early age.
1. Make sure you’re following a budget
Creating a budget is not so difficult task. Just pick a pen and a piece of paper and write down the total amount expenditure and income. Subtract the expenditure from your income. Thus, you can get the exact amount of money you can save after all necessary expenses. Try to increase your savings and cut down all unnecessary expenses to save more. If you can follow the budget that you’ve created, you can pay off your debts and contribute into your savings account more.
You can also read – Optimize your dollar: The ABC of pro-budgeting
2. Use cash for every purchase
Try to use cash for every purchase. Thus, you can keep track on your spending and won’t end up splurge a lot. Carrying a certain amount of cash will stop you from buying the next thing which you don’t need. Try to buy things that you need and not that you wish to buy.
3. Reduce the number of credit cards
Do you really need a wallet full of credit cards? Certainly not. Keep the most two credit cards for emergency transactions when you don’t have enough cash. Otherwise, limit your credit card usage to minimum. If you’ve less number of credit cards, automatically the usage will decrease.
4. Earn extra money
You can earn extra money through a number of ways. Sell the garage which is in good condition but you don’t need. If you love children, then babysitting is a good job to earn extra money. If you have interest in teaching, open a coaching class/tuition class to earn money.
5. Pay down higher interest debts first
Incase of multiple debts, I’m sure, some of them must have higher interest than the others. You should pay down these debts with higher interest rate first. This is because the more time you keep paying the interest rate the more money you spend in the long run. Thus if you pay off the higher interest debts first, you can save that interest amount in the long run.
6. Adopt some frugal habits
?You can make your own clothes. But if you’re too busy to make clothes then visit local store to get clothes. There’s no point to spend thousand of dollars on designer clothes. Take advantage of craigslist also. Try to make . You can use lime juice, vinegar and baking powder to clean bathroom, sinks, carpet floor so on.
7. Collect and use coupons
Discount coupons are another great way to save money. There are many websites which allow you to in exchange of your membership in the community. You can also get various discount coupons from magazines. You should cut and collect them and use them whenever you go out for shopping.
Investing is another big part of your financial lessons. You should read good books and research a lot in order to get the best benefit from your investment. Try to live without a list of debts. Don’t think that your plastics are source of money and debt is normal . Thus, you’ll see how successfully you’re managing your own finance.