Western societies tend to teach young people to first develop a financial mindset focused on student debt, followed by paying off that debt, followed by taking out a mortgage and sorting out tax returns… Overall, we are all pretty hard done by in terms of making smarter financial decisions. Thus, gaining good advice is indispensable to developing good habits above those of the average person. This is a guide to making better financial decisions in 2020.
There are those pointers you’ll find in any adult social gathering after asking some money-focused questions: save, invest, save, invest, pay off, save, invest… and the cycle repeats. What we should be doing is regularly asking ourselves if there are better ways to do things, however – this is how we evolve!
Leaving budgeting until the last minute
A lot of people see payday as the day to splash out. On the contrary, this is the most opportunistic day to make smart financial decisions through your budget. Once you know how much you want to save, how much you need to pay for rent and bills, how much you want to put towards food etc, you’ll have a very transparent view of how much money you have for you. This is a much better way to handle your money than spending blindly.
Increase your own financial education
Some people are lucky enough to be born into the families responsible for the wildly disproportionate distribution of money in the world, though it’s very likely you aren’t one of those people. In that case, you need to educate yourself in order to not be played over by capitalism. No excuses.
Pay off your credit cards within the time frames you have agreed to
“Before taking out any credit card, pay close attention to how much interest you’ll be paying off. Credit card debt is a major cause of stress and anxiety in people, who often did not pay attention to the small print when taking out multiple credit cards,” says Isabel Stone, marketing blogger at 1 Day 2 Write and Next CourseWork.
Take out your own health insurance
Imagine this: you wake up tomorrow. You feel great. You get up and put your trainers on, ready to go for a run. You smash the run and walk home to cool down. Then you get hit by a car that was speeding inappropriately. Life is unpredictable, right? Well, that’s what insurance is for. Don’t make the mistake of missing out on great insurance.
Have emergency funds
Life has many ways of showing us its truly unpredictable nature. Despite humanity’s age-old desire to create order, practical ways to go about living, circumstances occur that we couldn’t predict and so couldn’t prepare for, right? Wrong. If you find yourself losing track of your spending, you may accidentally eat into your emergency savings, leaving you in a very vulnerable position.
One of the best ways to prepare for any possible future event is to have a substantial amount of emergency financial support. Whether there’s major damage to one of your assets, you find yourself unable to work for a period of time, or have medical bills to address, the least emergency funds can give you is peace of mind.
“You should decide how much money is substantial for your emergency funds. A good time frame to consider is about six to twelve months’ worth of savings, giving you the leeway to make mistakes in life!” Says Henry Barber, a business writer at Write Myx and Brit Student.
Other things that have the potential to leave you feeling anxious or stressed about your financial climate are:
- Purchasing unnecessary items in order to stay up to date with what you see other people buying. Stop worrying so much about what other people are doing and start caring more about what you are doing. Avoid buying the latest phone, or that new car you saw in a personalised advert.
- Not organising an automatic savings system. Without proper education, you aren’t going to be able to wake up as an experienced investor. While you’re learning more, you need to have secure systems in place to manage your money, and an automatic system is the best way about this.
Author: Mildred Delgado
Mildred Delgado is young and responsible marketing strategist at Academicbrits.com and PhdKingdom.com. She works with a company’s marketing team in order to create a fully-functional site that accurately portrays the company. Mildred presents this information in a series of marketing proposals. You can find her works at Originwritings.com.