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| 10
financial tips for young people | | |
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Naturally, the more you earn, the
more you can stash away. A better way to invest: Rather than target
a specific monthly dollar amount, sock away 7 percent of your earnings
in the beginning, and increase it each year a little bit until you're
diverting 15 percent a year.
4. Place a value on money.
It doesn't buy happiness,
but it can certainly make you comfortable. Just understand what
it's worth. Money is what you earn in exchange for your time in
some productive pursuit. Let's say you earn $20 an hour at your
job, and you're considering purchasing a TV for $500. You may calculate
that you spend 25 hours, or about three days, earning that money.
It's worth it, you may think. But that's not an accurate value estimate.
If you're single, you're in the 25-percent tax bracket, so you actually
spend about 33 hours earning the net income required to make the
purchase. It still may be worth it, but there may be competing demands
for that money, such as rent and car payments, not to mention your
retirement fund. Each purchase represents a trade-off. Make these
decisions wisely.
5. Use the credit card sparingly.
This tip is also really vital. Bankrate receives tons of
letters from strapped consumers who regretfully overused their credit
cards and now find themselves in really dire financial situations,
some contemplating bankruptcy. It's easy to spend now with plastic
and much harder to pay later. Use credit responsibly. Comparison
shop for your card. Remember that you'll be relying on your
future earnings to pay for today's credit card purchases. And if
you keep a running balance, you'll also be paying interest, sometimes
at usurious rates. Don't fall into this trap. Instead: Save money
to meet financial goals.
6.
Follow the golden rule. Contrary to popular belief, the duplicity and craftiness
of Machiavellian tactics won't really help you survive, but instead will engender
mistrust in your relationships. Treat others fairly, the way you wish to be treated.
No one looks good when trying to make others look bad. When you're on the job,
avoid gossip. Beware that when someone takes you into his or her confidence to
point out someone else's foibles, it's only a matter of time before your foibles
come to light. Always be honest in your dealings with others. Seek out the company
of people who are positive and supportive of your efforts. 7.
Select your partner wisely. Choose someone whose values
match your own -- not just where money is concerned, but more importantly, ethical
and moral values. Get to know your soul mate over the course of at least a year.
Passion is important, but trust more so. Make sure you are free to be yourself.
If you hook up with an angry or overly critical partner, you will be subjected
to hostility and may lose your sense of self. Conversely, if you're the one with
anger issues, resolve them before they poison a perfectly good relationship.
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