If you grew up with a wonderful mother who taught you everything you need to know about money, credit, and finance, lucky you! Most kids learn how to insert coins into a piggy bank, but very few of them actually learn the valuable concepts of money management at a young age. If you desire a better understanding of money matters, pay attention to these motherly words of financial advice.
Save up for a rainy day
Moms who encourage their children to “save for a rainy day” speak the truth. That pink piggy bank you had as a kid was a good start; now that you’re an adult, it’s time to get serious about saving money every chance you can. Open an interest-bearing savings account and stash a bit of cash every payday. Saving money now means you can spend more money later.
Spend less than you make, and never the other way around. Learn to live simply, and you may be surprised at how much money you can tuck away. The concept of delayed gratification may seem foreign, but once you get used to it, you’ll wonder why you ever thought it was fun to waste money in the first place.
Invest intelligently, and only borrow as a last resort
Stay away from credit cards as much as you can. If you desire a high-ticket item, save until you have enough to pay for it up front. Credit looks convenient, but it’s too easy to get into trouble when you buy things on a whim and then pay high interest rates for an extended period of time. Think long and hard before making an purchase on credit, and always factor in interest costs to realize the ultimate price of an item. The exception to the no-credit rule is home mortgage. Most people cannot pay cash for a residence, so home loans are generally one credit debt worth having.
Make small investments in addition to paying into your savings account. Penny stocks can be a worthwhile way to learn about the stock market without risking an awful lot of money. If you think you want to try investing in penny stocks, you can get the best info from Money Morning.
Never pay retail price, if you can avoid it
“I never pay retail” is a phrase uttered by savvy moms in the know. If you do your research before setting out on a shopping expedition, you can come back home with all sorts of below-retail priced items. Clip coupons and spend them at stores that double or even triple the face value. Don’t, however, buy anything you won’t use just because you have a savings coupon. You can bend this mom’s rule if using the coupon will get you something for free. If you don’t want it, donate it to someone who does.
“Sometimes, you have to spend money to save money.” Many mothers offer that sage advice, and it makes good sense. When you see an item that you use every day marked down to a remarkably low price, buy at least two. Opt in to store newsletters to stay apprised of upcoming sales. If it makes sense fuel-wise, visit several different stores to buy all of your groceries on sale. Don’t be afraid of the mark-down bin. In fact, it’s always a wise idea to check the markdowns in your favorite store at the start of your shopping. You might find something you were going to purchase anyway marked down by half or more.
Graduate and be grateful
The Federal Bureau of Labor Statistics makes it quite clear that people who graduate enjoy bigger paychecks than those who drop out. On the average, people with professional degrees earn a whopping four times as much as someone with only a high school diploma. You’ve got to plan, however. These days, it’s hard to earn a degree without amassing an enormous amount of student loan debt. Excel at your studies, and apply for as many grants and scholarships as you can. You’ll get the same good education without saddling yourself with unbearable future debt. Money Talks magazine says you can go to college without spending a dime.
Above all, be thankful for what you have. If you have a warm place to sleep at night and good food to eat every day, you have it better than a lot of people in this world.
Sharon Butler writes about money. Whether she’s covering a crash in the stock exchange, personal finance matters or how-to articles on investing you’ll find her articles published across many blogs.