Managing money is mostly not taught in elementary school. About 17 states needs students to take personal finance course in high school, but only a few require testing on the topic.
In terms of money, it is better to learn from other people's mistakes instead of making yours. Keep to these tips when you are young to avoid financial hardship in life.
- Find
your purpose: If you face challenges figuring out what you need to do
with your life, just look within. Everyone is born with certain talents
and natural abilities. You know which subjects you surpass in and which
ones you scrap with. Choose a career that enables you maximize your gifts
in a way which fulfills you or helps others too. As you grow, your career
may change with your desires.
- Begin
retirement planning with your 1st job: If the company you work for offers a 401k plan, you
should sign up at your 1st opportunity. If there is no such plan, channel
some of your paycheck into IRA (Individual Retirement Account). If
you are lucky enough, one day you will find you are older, so it is best
to be prepared. Logically, as you earn more, you stash more. From at least
7% in the beginning, and then increase it each year till you are diverting
15% a year.
- Place a
value on money: Money
is a thing you earn in exchange for your time in some productive hunt.
Assuming you earn $20 an hour at your job, and you are considering
purchasing a Television at the rate of $500. You may calculate that you
need to spend 25 hours, or approximately 3 days, earning the money. You
may think it’s worth it, but that is not an accurate value estimate. If
you are single, you are in the 25% tax bracket, so you really spend about
33 hours in earning the net income needed to make the purchase. It might
still worth it, but there might be competing demands for the same money,
which includes rent and car payments, and not to mention your retirement
fund. Make your decisions wisely.
- Use the
credit card sparingly:
It is easy to spend with plastic card and much harder to pay later. Use
your credit responsibly. Remember that you will be depending on your
future earnings to pay for today's credit card purchases.
It
is not all about money. If you work at it, you will have abundance through
strong family ties and solid relationships, as well as monetary assets. Take
some time out each day to reflect on the good in your life. Spend at least 1
day a week in a recreational activity or hobby that you enjoy, and take a
minimum 1-week vacation annually if you possibly can so you can totally unplug
and unwind. Again, save for the trip. If you have children, spend as much time
as you can with them when they're still young and dependent on you. Before you
know it, they'll be old enough to get a driver's license, and you'll see less
and less of them from that point on.
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