8 Money Tips For Young People
As a young person myself, this article is both a reminder and a passing on of the great work of the people at Globe and Mail. These are 10 things young people should do to keep themselves on the financial side of life.
Invest in Yourself
Education, training and work experience while you’re young is never going to go astray. People who invest in their ‘human capital’ (one of the grossest examples of corporate-speak) are likely to earn more over their lifespan. On top of that, you’ll be ensuring you remain secure in your employment. Getting out there and getting experience, in study settings and any kind of work exposure you can, will keep you highly employable over the course of your career.
Good Debt
Staying out of debt isn’t the easiest or most practical option for most people. Borrowing money to start up a business or pursue further education can be a great kind of debt, as long as it’s treated sensibly. Student debt can be crippling in later life, so weighing up all your options is important. Staying in as little debt as is possible is no bad thing, so be smart about what you borrow for.
Having A Plan
Know how you’re going to pay off your student debt. Know how you’re going to pay your parents back for the loan to start-up your coffeeshop or your house deposit. Don’t ever get into debt if you don’t have a thorough plan about how you’re going to get out of it.
Save Early
There are a couple of great years when you start earning money that you can buy some things that you want- CDs, new jeans. But as soon as you star earning an income, you should start saving part of it as well. Not just for the money you save, but also to get into the kind of habits that will keep you on the straight and narrow for decades to come.
Talk Tax
Often people can miss out on tax benefits through ignorance, so when you’re starting out doing tax, it could be worth investing a bit of money and having a chat to a professional about what tax benefits you are eligible for. Chances are it could be the best $100 you ever spent.
Invest Long-Term
It’s easy to only care about the now and the get rich quick. For long-term financial gain, however, young people need to be taught about long-term investment, diversification and patience. Impatience can be the quickest way to bring a great plan for financial security undone.
Credit Card Debt
Don’t get in it the first place. If you do, ask for help immediately and get out of it as quickly as possible.
It’s Never Too Early For Personal Finance
First hand exposure to the stock market in the shape of giving a young person some stocks and allowing them to work out how to invest is a great way to prepare young people for investment. Explaining the necessity of saving a portion of the pay cheque. Setting up budgets. The earlier that young people are exposed to good personal finance advice, the better they are prepared for the financial decisions ahead.
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