Saving money as a young man can give you many benefits. You can use that money to pay for your high school or college, buy something special, you can save it up to being an adult and use it to pay for insurance or make a down payment on a car or your first home.
However, saving is not easy. You must resist the temptation to spend it, and you must also take responsibility for your actions, which is no easy task.
We know the importance of money savings, and as it’s not easy maybe it needs a personal finance help for young adults.
Saving money differs significantly in your 20s and 30s, so here are 17 financial tips for young adults. These seventeen tips divided into four part. With the four steps, you can save a lot of money and achieve your goal.
- Creating a Saving System
- Reduce your expenses
- Make extra money
- Keep track of your money
Building a Saving System
1. Think about what you want to do with the money.
One reason why many people don’t achieve their economic goals or can not save money is that they don’t know what they want to do with it. Do you want to save to pay for college, buy your laptop or a car? Deciding what you want to do with your money is the first step to saving money!
If you have difficulty determining what you want to do, check with the people who know you best. They could be your parents and your close friends. Thinking of other individuals who know you very well can help you get rid of your thoughts and reawaken your dreams and goals.
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2. Choose a savings goal.
When you know what you want to do with your savings, you can determine how much you will save each week or month, depending on when you receive your allowance, your salary, or any other source of income.
A good rule of thumb is to save $ 1 for every $ 3 you earn. Saving a third of your income might seem like a lot, but it’s the only way to save a considerable amount. Saving a third or 30% of all money you receive is one of the best savings strategies out there. Once you start doing it, it will become a habit!
Also, consider how much money you want to have and when. This will help you determine how much you have to save every week or every month. If you want to have $ 100 in a year and receive a weekly allowance of $ 5, saving $ 2 each week will help you reach that goal.
Also read: How to Save Money by Appreciating What You Have
3. Open a bank account.
Getting a bank account is a major step in becoming more mature and responsible. Also, having a bank account can foster healthy savings habits.
If you are under 18, it is likely that your parents have to appear on the account. A joint account is a form in which many banks offer accounts for minors. Both the names of your parents and yours will be issued in the account for legal purposes and financial obligations. This may seem like a disadvantage, but it can also make it hard to spend your money when you want to do it since your parents can quickly discover what you spend it for.
Look for banks that have the charges and minimum balance requirements. Many banks have an option for “young savers,” who charge a minimum monthly maintenance fee.
Keep in mind that in some countries, banks can only offer custody accounts. These accounts are investment instruments that restrict children’s access to the account and their funds (usually until they turn 18 or 21, depending on the country).
If this is the only option you have with your bank, try to find another bank that offers a standard savings account or wait to be a little older.
If for some reason you do not want to open a bank account, put your money in a locked container and give the key to your parents or just ask them to keep the money for you.
Also read: How To Multiply Your Money Every Year
4. Save all extra money.
If you get extra money for festivities or your birthday, always keep at least half. Some families even give their children college savings bonds or saved money to save them in the long run. Put that money in the bank, not your piggy bank.
5. Keep the change!
Put everything on the lunch money or whatever you have in a glass jar or a piggy bank and use it from time to time. You’ll be surprised how much you can save without even trying hard!
6. Negotiate with your parents.
Ask your parents if they can give you “equivalent” money to your savings to motivate you to develop good saving habits. Let’s say you save $ 40 a month and deposit it into a savings account. You can ask your parents if they could give you money equivalent to your savings and add another $ 40. This will make you a greater incentive to save. Your parents may or may not agree with this idea, but they may be more willing to do so if you are going to save for something they consider important, such as your education.
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Part 2: Reduce your expenses
1. Take with you as little money as possible.
Do not carry much cash in your wallet and try not always to take your debit card. This way, you will not have the need to spend money on unnecessary items or take impulsive decisions when you are in a store.
2. Save before you spend.
Whenever you receive money (either a gift, a monthly allowance or a salary), immediately take the amount you want to save and save it. This will ensure that you do not spend the money you want to save. The best part is that once you have saved your savings, you can spend the rest! After all, it is important to enjoy life and live a little.
3. Spend your money on important things.
You can spend your money on one element: your future. You must feel good when you spend money if it is an investment for your future and, especially, your future capacity to generate income. For example, you save to pay for education if you plan to enter a university. If you plan to become a singer, spend your money on singing lessons. Spend your money on proper clothing if you get an office job. It is perfectly acceptable to spend money to stand out and in turn make more money over time.
Also read: How To Invest Money Wisely For Beginners
4. Give a value to the money.
Understand what the value of money is and what it is worth. Remember that most of the time (except gifts), you get money for something you do. When you work, you are exchanging your time for money. You must decide if what you want is just as valuable as the time you needed to earn the money you will buy it with.
For example, if you make $ 10 per hour on a part-time job and you want to purchase a video game that costs $ 50, you will have to work five full hours (and a little more if you have to pay taxes) to generate enough money to buy the game. Do you think it’s worth it? Also, can you buy that game and balance the other needs that you need to satiate with that money, like saving 1/3 or paying the gasoline of your car? Every time you spend money, this represents compensation. You must think carefully about what you value and make decisions accordingly.
5. Stay focused on what you want.
Stay concentrated on the prize and exactly what you plan to do with your money saved. Draw or print an image of what you want and stick it in your piggy bank or your savings jar, or even on your debit card. This will keep you inspired.
Part 3. Make extra money
1. Offer some service to your neighbors or friends in the community.
It is clear that one of the key aspects of saving is having the money you want to save. One way to save more is to earn more!
In summer, start a business in which you offer to mow a lawn and in winter one in which you remove the snow. You can even sweep the leaves for your neighbors during the fall. It charges different amounts depending on the amount of work you must do and the size of the garden. You can promote your services by making flyers and sticking them on the posts, and ask your neighbors to place them in their doors.
Also read: Six-step to starting your own business
Give your friends or neighbors pet care, services. Pets need a lot of attention, and most owners would prefer to have their pets handled by a responsible child or teens, rather than sending them to a kennel.
Caring for your neighbors’ house when they are away on vacation. Caring for your pets, water your plants and pick up your mail. This is an excellent way to be a good neighbor and also earn some extra money.
2. Sells stuff.
Make a cake sale in your neighborhood or open a lemonade stand during the summer. Bring your used video games to a local game store or take your used clothes in good condition to a thrift store. If you have experience buying and selling things on the Internet, consider selling old stamps, electronic devices or collectibles through websites such as BuySell, OLX or even Facebook. Organizes garage sales a couple of times a year.
There are many great ways to earn a little extra money by offering a product for sale or by trading your old things for money. Be creative to achieve your savings goals!
Also read: I Can’t Quit The Job I Hate Because Of My Financial Situation
3. Get a part-time job.
Having to work to get money will teach you what your value is. If you are very young and the law still does not allow you to have a job, you could look for the old classic job for children: distribute newspapers in your locality! While it may seem old-fashioned, handing out papers will not only give you some extra money, it also has other advantages: you’ll spend a lot of time away from home, and you’ll be able to listen to music while you “work.”
Part 4. Keep track of your money
1. Keep track of your income.
Developing a budget and adhering to it is only possible if you know how much money you have. Determine and keep track of the amount of money you receive from different sources (e.g., allowances, gifts, payments, money for caring for a child, etc.).
If you have a bank account, keeping track of the money you have is very easy. In general, bank statements can be accessed online, or you can go to a branch of the bank to consult them. Printing it and saving it in a filing cabinet is a useful practice that allows you to develop an organization system related to the administration of your life. This will be very helpful in the future when you have to calculate your taxes or maintain control of your mortgage.
There are also apps for smartphones that make it easy to deposit money right into your account. Now many banks allow customers to take pictures of the checks with their smartphone and transfer the money to their bank accounts.
2. Keep track of your expenses.
Keep receipts or keep a box that shows all the purchases you made, including food. Put the date, the item you bought and the amount you spent. This way, you will know what you spent your money on.
There are also applications designed to control personal finances (like Wally) that you can download to your smartphone and use to record your expenses. Wally even allows you to take pictures of receipts that are then calculated in the application. This is an excellent way to learn about your drinking habits.
Also read: 7 Tips on How to Choose the Right Career for You
3. Take note of anything unusual.
Keep a check on everything that does not fit your everyday habits of saving and consumption. For example, you may have made a substantial purchase, such as a computer or an iPod, perhaps you paid the initial fee for a car or made the first payment for college tuition. Keeping track of the times when you do something unusual (even if you planned or needed it) will help you to know exactly what your financial situation is, which is important, especially at times when your balance is lower Which you normally have.
Keeping your record in order and being well informed will also help you to detect any errors or problems that may exist in your financial situation. You may have noticed that you are always missing $ 5 each week (first talk to your annoying siblings!) Or that you spend too much on fast food every week when you go to the mall. When you know what happens, you can reassess and determine how to re-adopt your savings goals.