8 answers
Lacey
Student
Delbarton, West Virginia
1
Question
Asked
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What’s the best way to be responsible with money?
Btw I’m in the 11th grade and I’m getting ready to start my new job.
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8 answers
Mackenzie Ward
associate
103
Answers
Houston, Texas
Updated
Mackenzie’s Answer
Being responsible with money is a crucial life skill that can help you achieve financial security and peace of mind. Here are some tips for managing your money wisely:
1. **Create a Budget**:
- Start by creating a budget that outlines your income and expenses. This will help you understand where your money is going and allow you to make informed financial decisions.
2. **Track Your Expenses**:
- Keep a record of all your expenses, no matter how small. This will help you identify areas where you can cut back and save.
3. **Set Financial Goals**:
- Define short-term and long-term financial goals, such as saving for a vacation, paying off student loans, or building an emergency fund. Having clear goals will motivate you to save and invest wisely.
4. **Emergency Fund**:
- Establish an emergency fund with three to six months' worth of living expenses. This fund can help you weather unexpected financial challenges without going into debt.
5. **Live Below Your Means**:
- Avoid the temptation to spend everything you earn. Instead, strive to live below your means by saving a portion of your income.
6. **Prioritize High-Interest Debt**:
- If you have high-interest debt, like credit card debt, focus on paying it off as quickly as possible. High-interest debt can quickly accumulate and hinder your financial progress.
7. **Save and Invest Regularly**:
- Make saving and investing a habit. Consider automating contributions to your savings and investment accounts to ensure you consistently set money aside.
8. **Educate Yourself**:
- Take the time to educate yourself about personal finance. Books, online courses, and reputable financial websites can provide valuable information about budgeting, investing, and financial planning.
9. **Avoid Impulse Purchases**:
- Before making a non-essential purchase, take a moment to consider whether it aligns with your financial goals. Avoid impulse buying, especially for big-ticket items.
10. **Comparison Shop**:
- When making significant purchases, compare prices, read reviews, and look for discounts or deals. This can help you get the best value for your money.
11. **Use Credit Wisely**:
- If you have a credit card, use it responsibly. Pay your balance in full each month to avoid interest charges. Be mindful of your credit utilization rate and maintain a good credit score.
12. **Avoid Lifestyle Inflation**:
- As your income increases, resist the urge to immediately upgrade your lifestyle. Continue living within your means and save the additional income.
13. **Plan for Retirement**:
- Start saving for retirement as early as possible. Take advantage of employer-sponsored retirement accounts like 401(k)s and consider opening an Individual Retirement Account (IRA).
14. **Build Multiple Income Streams**:
- Explore opportunities to earn additional income through side hustles, freelancing, or investments. Multiple income streams can provide financial stability.
15. **Seek Professional Advice**:
- Consider consulting a financial advisor or planner for personalized guidance on your financial goals and investment strategies.
16. **Review and Adjust**:
- Periodically review your financial goals, budget, and investments. Adjust your plans as needed to stay on track and adapt to changes in your life.
17. **Avoid Keeping Up with Others**:
- Avoid the temptation to keep up with others' spending habits or lifestyles. Focus on your own financial well-being and goals.
18. **Practice Patience**:
- Building wealth and financial security takes time. Be patient and stay committed to your financial plan.
Remember that financial responsibility is a continuous process. By practicing good money habits and making informed financial decisions, you can achieve financial stability and work toward your long-term goals.
1. **Create a Budget**:
- Start by creating a budget that outlines your income and expenses. This will help you understand where your money is going and allow you to make informed financial decisions.
2. **Track Your Expenses**:
- Keep a record of all your expenses, no matter how small. This will help you identify areas where you can cut back and save.
3. **Set Financial Goals**:
- Define short-term and long-term financial goals, such as saving for a vacation, paying off student loans, or building an emergency fund. Having clear goals will motivate you to save and invest wisely.
4. **Emergency Fund**:
- Establish an emergency fund with three to six months' worth of living expenses. This fund can help you weather unexpected financial challenges without going into debt.
5. **Live Below Your Means**:
- Avoid the temptation to spend everything you earn. Instead, strive to live below your means by saving a portion of your income.
6. **Prioritize High-Interest Debt**:
- If you have high-interest debt, like credit card debt, focus on paying it off as quickly as possible. High-interest debt can quickly accumulate and hinder your financial progress.
7. **Save and Invest Regularly**:
- Make saving and investing a habit. Consider automating contributions to your savings and investment accounts to ensure you consistently set money aside.
8. **Educate Yourself**:
- Take the time to educate yourself about personal finance. Books, online courses, and reputable financial websites can provide valuable information about budgeting, investing, and financial planning.
9. **Avoid Impulse Purchases**:
- Before making a non-essential purchase, take a moment to consider whether it aligns with your financial goals. Avoid impulse buying, especially for big-ticket items.
10. **Comparison Shop**:
- When making significant purchases, compare prices, read reviews, and look for discounts or deals. This can help you get the best value for your money.
11. **Use Credit Wisely**:
- If you have a credit card, use it responsibly. Pay your balance in full each month to avoid interest charges. Be mindful of your credit utilization rate and maintain a good credit score.
12. **Avoid Lifestyle Inflation**:
- As your income increases, resist the urge to immediately upgrade your lifestyle. Continue living within your means and save the additional income.
13. **Plan for Retirement**:
- Start saving for retirement as early as possible. Take advantage of employer-sponsored retirement accounts like 401(k)s and consider opening an Individual Retirement Account (IRA).
14. **Build Multiple Income Streams**:
- Explore opportunities to earn additional income through side hustles, freelancing, or investments. Multiple income streams can provide financial stability.
15. **Seek Professional Advice**:
- Consider consulting a financial advisor or planner for personalized guidance on your financial goals and investment strategies.
16. **Review and Adjust**:
- Periodically review your financial goals, budget, and investments. Adjust your plans as needed to stay on track and adapt to changes in your life.
17. **Avoid Keeping Up with Others**:
- Avoid the temptation to keep up with others' spending habits or lifestyles. Focus on your own financial well-being and goals.
18. **Practice Patience**:
- Building wealth and financial security takes time. Be patient and stay committed to your financial plan.
Remember that financial responsibility is a continuous process. By practicing good money habits and making informed financial decisions, you can achieve financial stability and work toward your long-term goals.
Gerardo Calderon
Regional Executive Chef
1
Answer
Fairfield, Connecticut
Updated
Gerardo’s Answer
Hold onto your money and use it solely for essentials. Craft a budget and stick to it faithfully. This way, you're not just saving; you're making every penny count!
Mandi Taylor
Title Clerk
25
Answers
Nashville, Georgia
Updated
Mandi’s Answer
I would highly recommend setting up a checking account and using a budget. You need to learn how to use a check register to keep track of your finances, such as your credits (money going into your account) and debits (money you are spending), you also need to learn how to write checks. This an old fashioned method but it is solid and you may one day need to use one and you won't have a clue how to do it. Learning this early on will help you tremendously. If you do better with cash money I would also recommend a budget book, or the envelope system. Both are very successful with those who use these methods.
Enise Agel
141
Answers
Updated
Enise’s Answer
Hello there,
You must save your money via budgeting. After your application is successful for a company which your salary must balance with your transportation, housing (if you are a tenant), needs (food etc.), clothing, pet(s) (if you have any pets… - you should count on a budget and spend only weekly. This is time to not spend your money to clothing, shoes, or any unneccesary items for now. A month later, you should have a plan for budgeting for the next month. Month by month, you should have some more money for the future, and prepare for the future inflation, taxes, and incoming economic crisis.
I hope this helps
You must save your money via budgeting. After your application is successful for a company which your salary must balance with your transportation, housing (if you are a tenant), needs (food etc.), clothing, pet(s) (if you have any pets… - you should count on a budget and spend only weekly. This is time to not spend your money to clothing, shoes, or any unneccesary items for now. A month later, you should have a plan for budgeting for the next month. Month by month, you should have some more money for the future, and prepare for the future inflation, taxes, and incoming economic crisis.
I hope this helps
Elizabeth (Betsy) Kvedar, CPTD®
Learning Consultant
66
Answers
Shelburne, New York
Updated
Elizabeth (Betsy)’s Answer
These are all great answers, and like everyone else, I would highly recommend that you build out a savings first strategy. Your future self will thank you.
I would also recommend that you take a financial literacy course at your high school, a local community college or even online. You will not only want to learn the structure of a good budget, but also how to understand how much money should be deducted from your pay statements, figure out your taxes, how to save for retirement when you are older, as well as to manage debt when you purchase a vehicle or a house. These skills are just as important as following a healthy diet and brushing your teeth.
The reality is that finances will change over time, due to factors outside of your control (businesses going bankrupt, markets crashing and job lay-offs). Strong financial skills enable you to re-adjust your financial plans quickly so that you can adapt with these changes and continue moving forward.
Good luck.
I would also recommend that you take a financial literacy course at your high school, a local community college or even online. You will not only want to learn the structure of a good budget, but also how to understand how much money should be deducted from your pay statements, figure out your taxes, how to save for retirement when you are older, as well as to manage debt when you purchase a vehicle or a house. These skills are just as important as following a healthy diet and brushing your teeth.
The reality is that finances will change over time, due to factors outside of your control (businesses going bankrupt, markets crashing and job lay-offs). Strong financial skills enable you to re-adjust your financial plans quickly so that you can adapt with these changes and continue moving forward.
Good luck.
James Constantine Frangos
Consultant Dietitian & Software Developer since 1972 => Nutrition Education => Health & Longevity.
3773
Answers
Gold Coast, Queensland, Australia
Updated
James Constantine’s Answer
Hello Lacey, Rise and Shine!
There's a wealth of excellent advice here, each piece valuable in its own right. But let's consider a fresh perspective. Imagine what a bank manager might ask you about your capital accumulation. How much do you require? What's your timeline? What's the intended use? The reality is, we don't need to rely on an accountant to validate our aspirations.
Clarifying these questions can help you solidify your purpose. Are you aiming for a million dollars for personal gain - or to benefit others? There's no need for a public declaration. The only person you need to convince is yourself. For instance, why shouldn't you secure this money to support your partner and future children in reaching their full potential?
If your goal is to assist others, then that's entirely commendable!
May Fortune Favor
Your Noble Endeavors,
Jim.
There's a wealth of excellent advice here, each piece valuable in its own right. But let's consider a fresh perspective. Imagine what a bank manager might ask you about your capital accumulation. How much do you require? What's your timeline? What's the intended use? The reality is, we don't need to rely on an accountant to validate our aspirations.
Clarifying these questions can help you solidify your purpose. Are you aiming for a million dollars for personal gain - or to benefit others? There's no need for a public declaration. The only person you need to convince is yourself. For instance, why shouldn't you secure this money to support your partner and future children in reaching their full potential?
If your goal is to assist others, then that's entirely commendable!
May Fortune Favor
Your Noble Endeavors,
Jim.
Dan Donovan
Designer
3
Answers
Phoenix, Arizona
Updated
Dan’s Answer
Great question Lacey. Lots of great advice from others on how to think about savings but it's also important to take advantage of the hard work and enjoy some of it now.
1) Yes, saving is a great idea but for what. If you have a goal in mind, write it down, do the research on how much you'll need and work backwards.
Ex. I want to have enough to buy a car when I'm 16. How much does the type of car cost? How much would you have to make each year to reach that goal?
Don't have a specific goal in mind, that's fine too! Because even if you don't know what you're saving for, the sooner you start saving money, the longer it has to grow over time.
2) Set aside some "play" money. You earned it and deserve to enjoy it as you go for food, clothes, activities, whatever.
1) Yes, saving is a great idea but for what. If you have a goal in mind, write it down, do the research on how much you'll need and work backwards.
Ex. I want to have enough to buy a car when I'm 16. How much does the type of car cost? How much would you have to make each year to reach that goal?
Don't have a specific goal in mind, that's fine too! Because even if you don't know what you're saving for, the sooner you start saving money, the longer it has to grow over time.
2) Set aside some "play" money. You earned it and deserve to enjoy it as you go for food, clothes, activities, whatever.
Christopher Doherty
Financial Advisor
24
Answers
Stamford, Connecticut
Updated
Christopher’s Answer
Hi Lacey,
Congratulations on starting your job and good for you for asking such a great question. Everyone is giving great advice, especially when it comes to savings. I would add two things:
1) open an IRA account: i may sound crazy to think about retirement because it is so far off, but those who put away starting with their first job will have significantly more $$ then those who do not. Contribution limits will depend on your income so you will need to check with the bank
2) buy David Ramsey's book called "The Total Money Makeover". Its shows a practical approach to managing you money for now and when you get older.
Good Luck!
Congratulations on starting your job and good for you for asking such a great question. Everyone is giving great advice, especially when it comes to savings. I would add two things:
1) open an IRA account: i may sound crazy to think about retirement because it is so far off, but those who put away starting with their first job will have significantly more $$ then those who do not. Contribution limits will depend on your income so you will need to check with the bank
2) buy David Ramsey's book called "The Total Money Makeover". Its shows a practical approach to managing you money for now and when you get older.
Good Luck!