If you are a teenager or a young adult, you might be right to a certain extent to think that any issues concerning personal finances are exclusively the problems for your parents. But pretty soon, you will also shoulder the burden of handling your own finances. It is a responsibility. So you might as well start young as you have more room for mistakes at a young age. Mistakes in future when you have huge responsibilities can cause a lot of stress and migraines.
Saving your money actually sounds a little old-fashioned these days with the constant reminders that we should invest rather than save. And with the relentless distractions that we have to contend with in daily life, it can be difficult indeed to have any focus or set a direction to follow with discipline. Television series, movie trilogies, fun smart phone apps, social networking, etc, take up a huge bulk of our free time.
If you are new to the employment market, you could be so excited with your first pay checks that you spend every cent without thinking about saving any since you can look forward to paydays for almost the rest of your life. It is therefore not a necessity to plan so far ahead when the future looks bright. Or if you are a high flyer who has had the fortune of making good money in your early years, you could be living it up without a care in the world. But as we always learn in life, good things cannot last forever. Because in 10 years, you will inevitably feel that the last decade passed by in a blink of an eye. So will the next 10 years. So do not leave it late to start planning your personal finances.
It is a common mistake of parents and those of the older generations. Many failed to plan their finances appropriately. It is not a real fault of their own. It is more of the newer generation being fortunate enough to have access to learn about self-help and other subjects through the advancement of technologies and distribution channels. We hear about them on television, newspaper advertisements, internet banner displays, etc. Even talk shows focus on this topic alone which can talk up a whole hour every week.
When we are young, tend to indulge in fine dining, fancy sports cars, latest smart phones, etc. And when dating, we spend even more money for adventurous activities, resort vacations, premium gifts, etc. But somewhere along the lines, you will know that you are overdoing it. You can’t maintain this sort of lifestyle if you are just on an average pay scale. And if you are making lavishing yourself a habit, you will enter yourself into a weird rat race. A race to meet your own luxuries. It will be like an addiction that you cannot kick.
We cannot ignore that we are at our physical peak in our twenties. That is surely the best to time to enjoy ourselves with the money we make. Because if we do have a bulging bank account in later years, we might not have the energy and physical stamina to do the fun stuff that we see on television. Although that mentality is understandable, don’t forget that you must budget yourself and leave something in the bank. You will know how crucial this is when you meet your first life event that needs a huge sum of money – your wedding.
No one is saying that you have to put aside 50% of your gross income into your bank account. If you have no problems doing that, great. But if you can’t, at least make an effort to set aside an emergency fund. You will never when a need arises for the funds to be drawn down. And you certainly don’t want that to happen when you are old and have little money in the bank.