Some tips and ideas to help young people manage their money.
1. The sooner you start to manage your money, you will be richer : when you’re young tend to think you have all the time in the world and it is too early to manage money, but the more you leave the more difficult later. Imagine 10,000 pounds you need for your 30th birthday : You could save 78 cents every day for 13 years, 4.47 pounds a day from 25 or 27 pounds a day from 29 . Every day counts when trying to take advantage of money and it’s never too early to start .
2 . Learn to buy: It’s not just about money – it does not mean just buying to save money, but also time. Imagine you gain 3 pounds an hour caring for the children of your neighbors. If you spend 15 pounds in a CD you could have bought another shop for 9 pounds, you’re not losing just 6 pounds, but also two hours of time (2h to 3 pounds per hour = £ 6) you could have spent on something else . Internet has been a great saving in the lives of many buyers and nowadays not only can buy almost anything from a computer with Internet access, but you can also compare prices at different stores, read user reviews etc . View Shopping online for a selection of recommended stores.
3 . Understand the difference between “capital” and ” income ” . Capital is something (money, property, stocks or other investments ), which generates income to its owner . The salary is therefore the income that we perceive through our working capital, hence the term “human capital” . Money is not just money, or equity or income.
4. Beware of credit cards : When in doubt, do not spend more than you have. The main risk of a credit card debt is to the point that you have no way to pay. If you need to borrow money there are much cheaper ways to get it . And if you do not want to carry cash, use a debit card .
5. Avoid loans : When you borrow, you’re saying goodbye to future income : if you ask 250 euros to a 12% interest and repay in 36 months, you ‘re actually giving the lending 9.44 pounds of your monthly income for three years, which is equivalent to 90 pounds of interest.
6. And if you have no choice but to borrow money, do not fall into the minimum payment trap : who pays does not care to return the money soon . Why would I be interested if you can get gold at the expense of debt? So there is nothing better for them than a customer who chooses the minimum payment to the longer term . Thus, most of the money that you return are interests and not the debt itself .
7. Do not fall into the trap of linguistic lenders : terms used to feel special to your prospects, you helping saying they have been ” specially selected ” or that they have been granted for any reason any special offers . Then downplay spending using expressions like ” low cost ” or ” value ” . Finally, do not emphasize the interest rate, but the monthly fees described as “easy” and ” comfortable ” .
8. Control of risk: one of the things that every investor should ask is how much you are willing to take risks . In general, the more caution, expect less income, higher risk and more chances to make more profits .
9. Never too young to open a savings account for housing is evident that spending – and the loan – largest that have to confront is buying an apartment, but the error of many young people today is not starting to think about it until well finished studies . But how much more you save now, the less you’ll have to ask mortgage later and have better quality of life when you finally move into your own home.
10. Make a pension plan : if you want to save enough to stop working at a reasonable age without having to worry about money, do not forget to make a pension plan . To guarantee a quiet retreat you should start planning soon.
