10 Financial Tips for Young People

Going to school is one thing, but learning how to manage your money comes from the school of hard knocks. Most people enter adulthood totally clueless as to how to manage their money. Here are 10 tips to help young adults get on the right foot.


1. Don’t Skimp on Education

Getting a higher education will help you in choosing a career and preparing for it. While fresh out of high school, go ahead and begin a college education. It could mean all the difference between you and a similar candidate vying for the same position. 

2. Understand Your Personal Finances

Managing with what you have starts with getting a grip on how much money you have at your disposal. It’s like making a budget, but it means you count every dime you bring in and then subtract your monthly expenses. That will leave you with the amount you can spend without going into debt.
 
3. Take Care of Your Taxes

It’s very important to understand your tax status and how you can handle your tax situation. When you get your first paycheck, figure out the taxes that will go out from thesalary and set aside money for them.

4. Bank Accounts

No matter how much you earn each month, put a reasonable amount in a savings plan for emergencies. Unexpected expenses can strike anytime and anywhere, so don’t put yourself in such a tight spot that you can’t handle emergencies.

5. Control Your Expenses

However, much you earn, if you’re not careful about how you spend that money you’ll end up in debt. Check your basic fixed expenses and evaluate if there is a place to reduce them. If not, then be careful that your monthly expenditures stay within budget.

6. Evaluate Retirement Plans

Don’t wait until you hit middle age to begin thinking about retirement. Honestly, that will be too late. You won’t have time to build up a decent retirement fund unless you begin early, with your first job.

7. Credit Card Debt

Even if you don’t take out a loan, you can easily become indebted to the bank by using your credit cards too freely. If you have credit card debt then begin to pay for new expenditures in cash until the debts have been paid.

8. Learning About Investing

If you have money that you can part with, consider an investment plan. Take an investment professional to help you understand how much you can invest and how to do it safely.

9. Protect Your Money

Whether you buy a house or rent an apartment, you must make sure you don’t pay too much. Get renter’s insurance to protect your contents and get a lawyer to check your rental or sales contract.

10. Be Careful What You Buy

Buying the cheapest item on the shelf isn’t always the best buy. Do some true cost comparisons by considering how long an item will last and consider the long run costs or maintenance. Good quality might cost more initially but it’s usually the best in the long run.

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