How to start managing your money now
By Jack Landis
As the Class of 2020 graduates high school, in a virtual sense, they begin the transition from childhood to adulthood as so many have done before. And one of the most important qualities of that coveted adult life is financial responsibility, and with that, the most important element is time. Building good financial habits when young, can make life easier when transitioning from university to the “real world”. Even with just a small savings account, certain actions made now can have tremendous effects later in life.
The first step would be learning how save and to invest in the traditional stock market based on traditional financial theory. This means thorough research into a specific company and then purchasing stock from that company. A good place to get started is the app Robinhood, which offers completely free trades, as opposed to a small fee being attached. This means that you can get started immediately and don’t have to pay any middle man to purchase stock.
Next would be to familiarize yourself with certain retirement options that, when started early, can turn in to secure savings for a comfortable retirement. Unfortunately, many people do not think of this until later in life. And considering all the expenses of life, (having children is expensive) relying solely on Social Security is not a good plan. Learning how something like a Roth IRA works, and starting at a young age can turn in to quite the amount of savings come retirement. Similarly, and also important, is learning how to budget. This means tracking your expenses from month to month and making sure you carve out spots for savings in places such as the stock market, retirement accounts, and savings accounts.
Also important is to start building up good credit. Some companies offer a student credit card which, with on-time payments, can be used to start building a good credit score. Credit is important for qualifying for lower interest rates when buying a car or a house one day, so it has to be one of your top priorities.
And with funding a college education, use student loans as a last resort. If you can, try and find as many scholarships as possible which will make the burden of college expenses a lot easier to manage.
Also pay attention to all the discounts you’ll now get since you’re a student. Many places and companies offer heavy student discounts if you use your student email, student ID, or prove you’re a student through a third-party service. A really good one for students if Spotify Premium, Hulu, and Showtime all for $4.99 a month, so there are definitely some great deals out there!
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