Many younger folks tend to consider financial independence, but only if they can do so from the ‘fast lane.’ It is going to take hard work, commitment, dedication, and not through fraudulent activities. If you want to be financially independent as a younger person, you will need to be accountable to someone and responsible for your actions.
The Younger Generation
Many in the younger generation tend to spend frivolously and not consider money as a conduit, resource or tool. It sometimes is the parent’s duty to teach children how to be financially aware of the dangers of overspending and not being able to determine where money is being spent. In fact, many young people are not allowed to pay their own bills. Parents will oftentimes take care of the bill, especially if the parent is an enabler. These youngsters will make mistakes with their finances; only because they are uninterested and not knowledgeable. Let’s explore some of those same mistakes.
Not Taking Full Advantage of Discounts
Some of the errors made by these youngsters could have been avoided if they had known. The lack of knowledge makes it even worse. Many fail to take full advantage of discounts. In the days of technology, sales and the Internet, there are many goods and services that are discounted. However, once a young person realizes the work it will take to possibly cut coupons, they are onto their next video game and not interested. If you can buy something at a lower price, why wouldn’t you?
Improperly Using Credit Cards
When a young person is not educated financially, they tend to be prone to making the huge mistake of using credit cards to purchase insignificant items of not much value; while not understanding the effect of the interest rate on their credit. Some youngsters fail to pay their credit card bills in a timely manner and it subsequently affects their credit scores in a negative way.
Yes, we know budgeting is not an easy feat. However, it is necessary, especially when you want to maintain control over your finances. It doesn’t matter what your age; as long as you are earning an income and paying expenses, you must have a planned budget. With advanced technology of online apps and spreadsheet software programs, it should be easier for young people to budget now than in the past. The economic climate today is difficult than it was in the past and so youngsters that do not budget will have so much more to lose.
Many young people do not evaluate their credit limit and therefore will sometimes overuse their credit and find themselves deep in debt. On the other hand, many young people think that they have to wait until they are much older to save for a car or home. While this is taking on debt, it is good debt that can be considered an investment or feature for building good credit.
Hardly any young person will think of an emergency fund unless financially responsible or told to do so. Parents may have to educate their children on the importance of an emergency fund to deal with times when the unexpected happens.
If you are a young person, it is never too early to learn how to be financially responsible and independent. Your future depends on it. Therefore, start looking at your finances now and ask questions when you are in doubt.