by admin | November 16, 2017 10:49 am
We’ve all made mistakes in our lives. And we’ve all been told to learn from these mistakes and move on. It’s even better, though, when you can learn from the mistakes of others and avoid the process of making mistakes altogether. The financial mistakes you will make in your twenties have been made before by many people, many times. Learning from those who have come before you saves you from financial growing pains and leaves you wealthier in the long run.
You don’t have to reinvent the wheel to be smart about your money. Freedom Debt Relief has seen mistakes young college-age adults make. To help you improve your chances of avoiding these mistakes, we’ve created this post.
Freedom Debt Relief has seen many young people who pay no mind to their credit score until it is too late. When applying for a home or car loan, your interest rate (or whether you get the loan at all) will be determined by your credit score. A good credit score will get you low interest rates on a mortgage which saves you hundreds each month and tens of thousands of dollars in the long run. If you have no credit history, now is the time to start building it.
Freedom Debt Relief has seen the effects of being too stubborn to seek financial help. No matter how smart you are, you can’t replace experience. A financial advisor can be a big help in helping you to see the financial big picture. If you don’t want to pay someone to help, look for a friend or mentor who has a good handle on his or her finances and ask for help.
Freedom Debt Relief knows too many young people who think they don’t need a budget. Seeing your income and expenses right in front of you is a great way to curb spending. Even if you don’t have a problem overspending, budgeting can help you get a firmer grasp on your finances. Knowing exactly how much money you have coming in and going out each month is essential to making wise financial decisions. When you create a budget, make savings a mandatory expense.
Just because you are perfectly healthy now doesn’t mean you will be forever. Whether you’re twenty or sixty, your lifestyle choices will always catch up with you. No one wants to spend their retirement in debt because of medical bills. Get enough sleep, eat well, and exercise regularly. Consider it an investment in yourself.
A sunk cost is an expense that has already been incurred. Freedom Debt Relief knows many young people see a failing investment and don’t want to give up. Hoping to “break even” they put even more money into a bad investment. The power of investing when you are young is your broad time horizon. Each investment you make does not have to be a success. Cut your losses and continue to save and invest your money in a diversified way over a long period of time. This will allow compound interest to radically increase your overall returns.
Let the mistakes of others be a guidepost for you. You don’t have to reinvent the wheel to make solid financial decisions. Take control of your finances and strive to become more financially literate each month and year. Learn from the financially savvy and you’ll be on your way to a comfortable retirement
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