Skip to main content
9 answers
11
Updated 455 views

What strategies can help me be financially stable early on?

I've noticed my parents always struggling with finances due to their spending habits and lack of financial understanding. I want to avoid this for myself at all costs and was wondering how I can implement good saving and financial habits early on to avoid falling into the same debt situation myself. I want to live without worrying about money but also have the ability to spend on wants occasionally. I will start college Fall of 2025 and I will be paying for college all alone with perhaps some financial aid from college because of cutting contact from my parents and not having parental support for separate reasons. However, I still want to make good financial decisions so I don't spend my life in crushing loans and debt. I have no knowledge of finances, cards or banking related stuff, so I would love to learn all there is to know.

+25 Karma if successful
From: You
To: Friend
Subject: Career question for you

11

9 answers


0
Updated
Share a link to this answer
Share a link to this answer

Matthew’s Answer

There are great answers to this question regarding saving, budgeting, burn vs spend, etc. I want to give a few more specific strategies that might be helpful:

Matthew recommends the following next steps:

Treat your credit card like a debit card, and NEVER let it charge you interest. This will improve your credit score, earn rewards points/cashback, and provide an extra layer of security from hackers.
Learn to cook. Eating out is expensive (and often much less healthy), so save it for when you are with friends. Look for simple recipes and marinades, and invest in a decent spice portfolio and an air fryer. It won't take long before you like your own cooking better than the restaurant food anyway!
A college degree provides valuable income opportunities... sometimes. There are degrees with much lower returns on investment... if you've always dreamed of studying sociology or political science, be sure to pair that with a second major with higher earning potential. Starting in Community College and transferring to a 4-year public university dramatically reduces the cost of college as well. Where you go and what you study will have a huge impact on the financial value of college. And don't discount the value of trade schools!
Stay safe and healthy! Medical debt is crushing our population, driven by poor diets and sedentary lifestyles. You won't easily see the savings benefits of eating healthy and staying active but believe me, they are massive assets to your finances. Take care of yourself :)
0
0
Updated
Share a link to this answer
Share a link to this answer

Sherry’s Answer

- Set a budget for what income is coming in vs. what you are spending every month
- Estalish a healthy credit history by paying your bills on time, avoiding credit card debt
- When you begin working, explore financial benefits with your employer and sign up for 401K, and other savings plans. The sooner the better.
- Follow the 50-20-30 rule. The 50-30-20 budget rule states that you should spend up to 50% of your after-tax income on needs and obligations that you must have or must do. The remaining half should dedicate 20% to savings, leaving 30% to be spent on things you want but don't necessarily need. The rule is a template that's intended to help individuals manage their money.
0
0
Updated
Share a link to this answer
Share a link to this answer

John’s Answer

It's commendable that you're already considering your financial future - this forward-thinking is a positive sign. As you prepare to embark on your college journey, it's crucial to carefully evaluate the institution you're attending and the total cost associated with it. College years can be immensely enjoyable, but it's also important to minimize your loan burden. Try to secure as many scholarships and grants as you can. If it doesn't interfere with your academic performance, you might also want to consider part-time employment.

After graduation, many individuals become preoccupied with projecting an image of wealth. However, if your aim is financial stability, it's essential to create and stick to a budget, with a strong emphasis on saving. A common pitfall for many is living beyond their means. True financial stability isn't about appearing wealthy, but about building actual wealth. This essentially means saving money and resisting the temptation to purchase the most expensive items within your reach.
0
0
Updated
Share a link to this answer
Share a link to this answer

Garrett’s Answer

Hello so first I lessen to Dave ramsey why is a business and personal finance expert but we'll running my business he said 1 thing to someone and it just clicked " do not make decisions based on your account but make decisions based on accounting " so make sure that you have a budget and are tracking your money so your are telling your money what to do instead of wandering where it went
0
0
Updated
Share a link to this answer
Share a link to this answer

Mario’s Answer

College is an expensive endeavor no matter how you look at it. If you are not receiving a full ride scholarship I would highly recommend you look at an in state community college for a few semesters to get in your base requirements then look at transferring into a larger school/university after 2 or so years. You can even work with a school you are already accepted to determine what classes from the community college will be able to transferred in and avoid losing any credits when doing so. On top of that working and establishing a budget or conscious spending plan is essential at all points in life. The earlier you start the sooner you will have success.
0
0
Updated
Share a link to this answer
Share a link to this answer

Torin’s Answer

Hello Rashmitha,

Maintaining a sound financial life is crucial. A piece of advice that always resonates with me is, "It's not about the quantity of money you earn, but rather how you manage the money you have." Keeping a written budget is a practical way to keep track of your spending habits. Whenever you're about to make a purchase, no matter how small, it's wise to check your account balance first. This way, you're aware of exactly where your money is going. As your financial circumstances evolve, your budget should adapt accordingly.

The topic of credit is another significant aspect. Good credit can be a lifesaver in times of need, while bad credit can exacerbate an already challenging situation. I suggest that students consider getting a starter credit card to cultivate good credit habits from the start. Keep it straightforward - make one purchase with the credit card each month and ensure it's paid off in full. This practice will help you learn how to handle credit responsibly and avoid future issues. Whenever you borrow money, it's essential to have a repayment strategy in place.

When it comes to banking, many banks offer free accounts for students, so you shouldn't be incurring any banking fees. I would advise choosing a bank that provides excellent online or mobile banking services, as this can assist you in managing your budget effectively. It's also beneficial to have both a checking and savings account. Make it a habit to deposit a portion of each paycheck into your savings account to accumulate an emergency fund. Ideally, you should aim to have at least six months' worth of expenses saved as a safety net.
0
0
Updated
Share a link to this answer
Share a link to this answer

Donna’s Answer

If you are able to work during school, try to save half or what you make whenever possible. Do not get caught up in credit cards. You do not want to pay interest or minimum payments. Try to live with the concept that if you cannot afford to pay cash then is it absolutely necessary to purchase it. There may be times when a small investment may produce a greater good and it would be worth putting it on a credit card. However, depending on the purchase try to look for a similar item at a lower cost.
0
0
Updated
Share a link to this answer
Share a link to this answer

Patty’s Answer

You are on the right track! Don't live above your means and pay cash. Start saving early and always think about your future and where you want your money to go. If you are planning on working while going through school think about the field you want to be in to get a jump start on experience, which could lead to higher pay and better opportunities. Once you start working contribute to a 401k.
0
0
Updated
Share a link to this answer
Share a link to this answer

Isabel’s Answer

Dear Rashmitha,

To lay the foundation for financial stability at an early stage, begin with self-education on the subject of personal finance. Get to grips with budgeting—monitor your earnings and outgoings to manage your expenditure effectively. Initiate a savings account at a bank and utilize it to accumulate an emergency fund. Steer clear of unnecessary debt by comprehending interest rates and exercising caution when using credit cards. Look for resources on financial literacy on the internet or at your prospective college. Prepare for college costs by applying for scholarships and grants. Contemplate part-time employment or internships to acquire experience and boost your income. Establish financial objectives, give priority to savings, and revisit your budget occasionally to make necessary adjustments. Cultivating these good habits today will lay the groundwork for financial security in the future.
0