There is no question that America has a problem with debt. Countless people fall behind in their bill each month. But, this won’t have to you, right? When you become an adult, you will make wiser financial decisions than your parents. Are you so sure? In order to survive tomorrow, you should start learning how to make wise financial decisions today. These are some things that you, as a teen, can do now to keep yourself from drowning financially later.
Learn how to budget
Learn how to budget. It is easy to overspend and end up in debt. In order to dodge financial pitfalls, it pays to learn how to budget while you are young. How do you make a budget? You begin by making a list of all of your income. It doesn’t matter where the income comes from. It can be an allowance, birthday money, or money from a part-time job. Then make a list of the things you want to purchase and the amount of money they want to save. Then do the math. Subtract the amount of money you need for saving and paying expenses. This will help you see how much money you have left for entertainment and how much money you will need to save in order to purchase that coveted item. Learning to budget now will help you to become more money conscious and to control impulse spending.
Take the classes
It is also wise to take a class that will help you learn how to manage your money. Classes like Economics, Accounting, Personal Finance, Business, and other computer classes will help you learn how to manage your money now.
Start saving now
Don’t put off saving money until you are older. Now is a good time to start saving money. You can start by opening a saving and/or a checking account at the bank. Some banks have free checking and other discounts for students. So, take advantage of these discounts now and watch your savings add up.
Learn the difference between wants and needs
It is difficult for adults as well as teens to distinguish wants from needs. A way to do that is to ask yourself if what you are want to buy is an absolutely necessities like school clothes or is it a want like a new designer purse. Once you have identified what necessities are, it will be easier for you to identify the things that are not necessities.
Well, you have done the budget. You have learned the difference between a want and a need. You see a new pair of designer shoes. They cost too much, but you have the money. Should you buy them? Although you can afford the purchase, why waste the money? Learn how to resist temptation now, and it will be easier for you to do later when you are bombarded with credit card offers.
Look at the big picture
Begin to set financial goals. Have things that you are working toward purchasing. You can then decide how much money you will need to save and how long it will take for you to save it. Having financial goals will also make it easier to stay on budget and to save money.
Yes, you can have some fun with your money. However, you should learn how to manage your money now. This will save you years of heartache and grief.