While most young people in 20s are deluded by their tender age, they forget that every tick of the clock inches them closer to positions of responsibility. Their life uncertainties plunge them into financial confusion making them think they need not to invest their money and build financial ground for their 30s.
As a result, they engage in poor money habits only to come to their senses when they are approaching or 30 already. At 30, life becomes more serious and you need to take your finances seriously. Here are 10 golden money rules you need to know before you get to your 30s:
Budgeting for all your expenses
Working with a budget is a sure way of spending and managing your finances. It allows you to channel your money in the right direction and on the right things, as well as trace where your money goes. This will help you know where you are overspending or under-spending.
With a good budget you will control your money and also save from your income. This is a habit every person aspiring to build financial wealth needs and should develop.
No amount of money is ‘small money’
Do you ever wonder why some people earn 100s of thousands and have little if any to show for it? Also, have you ever been amazed at how some people with minimal earnings have amassed great wealth? Well, the difference between the two is not how much but how well the little earner manages his/her money.
It is completely, if not absolutely, delusional to believe that you will start saving when you get a ‘big’ job. So knowing how to use your money wisely will deliver you from financial bondages.
Start investing now
Financial wealth does not come overnight so investing early on in life is prudent than late investment in life.
You do not have to wait until you are 30 to start investing. Early life investment guarantees you greater chances of compounding your money. You could start small and grow your investment with time.
The Internet provides readily available information about numerous investment opportunities available. Currently, there are investments you could start with as little as one thousand shillings.
Do not live outside your means
Being contented and living within your means is the wisest thing you could do. Creating a decent budget and remaining faithful to it relieves you from the madness of overspending and debt accumulation. Doing this leaves you with financial freedom, even better is the surplus you get when you confine yourself within this limit.
Save first before spending
Setting aside automatic deductions into a savings account is a better way of disciplining yourself. This saves you from the temptations of using what you are supposed to save. With this you develop a habit of saving first before spending.
Always have money set aside for an emergency
Life presents us with uncertainties every day. It could be job loss, an abrupt health issue, or even an unexpected family issue. This calls for a counter emergency plan, making emergency savings appropriate.
Setting aside some money regular for any life eventuality will help you with these emergencies whenever they strike.
Create financial goals
Setting clear financial goals will help you realize financial success and defining your goals and developing realistic and attainable steps would move you forward. The absence of good goals may mean lack of success in your financial endeavours.
Settle your debts
It is prudent to offset your debts in order to free yourself and also to know the value of your investment. It might be hard to grow your savings and investments with debts still around you.
For instance, by repaying those debts, you are guaranteeing yourself the same amount of money since you do not have to pay it again once it is settled. It is an important pre-requisite in growing your wealth.
Plan for major projects
We all have things we wish to have sometime in the future. It may be a car, home, or even a family. So saving for these things ahead of the time would help you move an inch closer to achieving them.
Buy insurance
While many young people may not see the need for investing in insurance, it is a greater step towards using your money wisely. The uncertainties surrounding your life may strike suddenly when you have no money. In this case, insurance would help you a great deal to handle such things. Planning your life by buying insurance would also help you with your future family. Some insurance policies allow you to bring spouse and children on board, relieving you of the burden of starting a fresh.
Once you master these concepts, your path to financial liberation and growth would be assured.
