Poet Ralph Waldo Emerson complained that students were not taught basic life skills: “We’ve spent 10 or 15 years trapped in reading rooms at schools and colleges until we’ve had enough. They come out with words, but they don’t know anything,” he said.
How true is that statement, especially when it concerns money?
Here are six basic and important tips to help young people reduce their debt burden and increase their net worth.
Don’t listen to the group “them”
I’m sure you’ve heard someone say, “I was told I needed to buy a house to be rich.” Or maybe “paying rent is a waste of money”.
You might say, “College debt is good debt, so don’t worry about paying it off soon.” Invest instead. “
I’ll tell you who you are. Most often, it’s people who have a biased interest in how you spend your money.
they are often wrong. They contribute to financial stress and make you feel like you’re not succeeding fast enough.
Financiers and real estate professionals need homebuyers. But until you are ready for such an expensive move, rent.
In certain high-cost areas, you may not be able to afford a home. And for some, it’s fine. We’re not throwing money down the drain to pay for the roof.
And ultimately, you’ll want to invest your own money for a chance to beat inflation. But if you’re going into debt and dropping out of college, tackle that first. There is still time to invest.
Don’t Believe People Who Say There Is Good Debt And Bad Debt
Using adjectives to refer to debt is not helpful. It’s just debt, and it can be destructive if it’s overused or overpowered.
and Berkshire Hathaway General meeting of shareholders, Billionaire Warren Buffett was asked by a 14-year-old boy what financial concepts he would give to young people who still have time to put them into practice.
Buffett, one of the world’s most successful investors, didn’t talk as much about picking the right individual stocks as many might have thought.
His first tip was about avoiding debt.
“If I have one piece of advice for young people, it’s generally not to go into debt,” Buffett said.
Don’t Get Familiar with Loan Grace Periods
When graduating from college with a student If you have debt, don’t wait to figure out how much you owe until you have to start paying off the loan (usually 6 months after graduation for federal loans).
Grace period is practice time. You have to feel the pressure of how these payments affect your monthly budget.
If you have time to start paying, deposit that amount into your savings account each month. Get used to the feeling of spending less because of the loan.
Don’t Just Focus on Monthly Loan Payments
Always check the total amount of what you owe. This means more than just being able to afford the monthly payments and interest charged.
How much will that loan cost in the long run?
If you haven’t paid off your debt in a while, think about what else you could do with that money.
If you borrow too much to buy a car, you can’t invest that money. If your mortgage is too high and your budget is too big, you won’t be able to build an emergency fund for when life hits.
Don’t treat your budget like an enemy
Treat your budget like a love object. Stay connected. Change if necessary and appropriate to keep things moving.
For those who don’t know the song “And I say I’m not going.” Find us on YouTube. I like Jennifer Hudson’s version of the movie Dreamgirls.
Here’s how It starts: “And I say I won’t go you are the best man i know he can never go No, no, not at all. No, no, no, I can’t live without you “
Now replace the words “best people” with “best budget”.
That’s how you look at your budget.
No, no, I can’t live without it.
Stop saying “I don’t know”
Me: How much is your total student loan debt?
Young Adult: I don’t know.
Me: What is the difference between gross salary and net income?
Young Adult: I don’t know.
Young Adult: Don’t you know?
Poor financial literacy can leave you broke and hinder your ability to grow wealth.
There are a few things I would like you to know.
There are times in life when being ignorant about your financial situation is an option, and it is not beneficial to you.
children can say Because they usually have parents or guardians they should know. But by the time you graduate from high school or college, you should be responsible and learn as much as you can about budgeting, credit, saving, and investing.
can’t do it anymore afford Saying “I don’t know”.
