Getting on top of your finances at a younger age is a great way to stay ahead in life. Putting away a little money here and there can add up, but there are steps you can take to grow it exponentially, too. You need to avoid common money mistakes, and take advantage of the tools that exist to help you.
4. Keep Track
Stay on top of your money, know how much you have, know where it’s going. Sometimes, adults get into a bad habit of racking up debt and then becoming afraid to look at their account balances and credit card statements. No matter what, you’re always better off knowing where you stand financially.
There are some good apps that can help track your finances, too. Either way, knowing where your money’s at and where it’s going is step 1 to achieving any financial goals for the future, or even the short-term.
3. Take Risks
Risky investments can absolutely ruin you when you’re older. You don’t want to put all of your retirement funds into some new startup or technology, but when you’re young, you can be a little more open to risks that could pay off in huge ways.
This doesn’t mean you should go and gamble away every paycheck, but you can keep some money aside for things like cryptocurrency and the blockchain and other unique tech that could end up drastically changing the way our world works. Having a piece of that pie earlier on could end up giving you financial freedom later in life.
Make sure you understand how the blockchain works and the power of cryptocurrency. A site like VanillaCrypto can help explain everything you should know before investing in crypto.
2. Use Debt Wisely
Debt isn’t something to be afraid of. Debt is a very useful tool, but you have to use it smartly. For example, paying a 19% interest rate on a credit card that you use for going out and partying isn’t wise. But if you can earn 10% on the money, then don’t rush to pay off a debt with 5% interest.
Pay off your highest interest loans first, but if you can earn more on any money that you’ve borrowed, ride that out as long as you can. Debt is normal, and all of the world’s largest companies use debt to their advantage, but you’ve got to understand how it works first or it can get you into some real trouble.
1. Work Hard
It’s cliche, but hard work will still get you pretty far. You need a bit of luck here and there, it helps to network and know the right people, but at the end of the day, you can’t replace working hard towards achieving your financial goals.
If you don’t come from a family with money, then you might not learn some of the basics, but you can take initiative on your own to learn the tools that help people generate wealth, and you can forge a new future for yourself and for your family. Not everyone is going to end up rich, but if you’re smart about money at an early age, no matter where you’re starting from, you can ensure that you’re comfortable and don’t have to worry about money too much later on.