How can I secure financial stability in my future?

Question

I'm fifteen, and I've lived in a hand-to-mouth situation my whole life. I would really like to rectify this in my future, heck even now would be GREAT. What are some ways I can prevent this problem from carrying over into my adult life? I'm going to get kicked into my own shoes some time in the imment future, and I don't want to have to struggle like I've watched my parents do my whole life. Serious answers, please, I'm not joking.

my family doesn't believe in credit cards....

Answer 1

Tris, this is a great question and you are showing maturity beyond your 15 years in asking this. I did sort of chuckle when you stated that you had lived hand to mouth your whole life as I'm 41 and did the hand to mouth thing for more years than I care. I also have a Masters in Business Administration which helps to determine 'really' what hand to mouth is.

But, the first thing I would tell you is to be very afraid of credit cards. This is the first step to living hand to mouth and eating a bit of your money from the next paycheck as well. Credit is THE most overused facet in our financial lives. Quite literally you don't need credit at all. The only reason you need credit is when you want to buy something that you don't have the money for.

There are only two types of borrowing activities that I reccomend people engage in and that is money for school and a home. All other debt is bad debt. For instance, when you borrow money for a car not only are you having to pay the bank extra amounts of cash each month to satisfy the terms of the loan, but the value of the car is GOING DOWN!! You are getting hit with a double whammy! Just think if you drove a clunker around for a while and made those car payments to yourself. Then not only would you get a new car in five years but you wouldn't owe anybody anything!

So, the lesson is that you should never borrow money for things or items that are going down in value (depreciating).

There's two steps to ensure that you will live a happy and healthy financial life. The first is to make two lists. The first is of things that you need, such as clothes, haircuts, toothpaste, food. But, be reasonable. A pair of Gucci sunglasses may be thought of as 'clothes' but they are certainly something that you don't need. The budget is only for things you absolutely have to have. These items you pay first.

The second list is of things you want. Like, I want to buy a old corvette one day. So, I am saving. This is the real secret to wealth. Budget for the things you need and save for the things you want. Learning the distinction between the two is one of the most important and hardest things we can do in our financial lives.

Now you have two tools. The first is never borrow for anything that will depreciate in value. The second is to budget properly and learn to save. By the way, saving for retirement is something that goes on the need list. Saving for college is also something that goes on the need list. Saving for a new Mustang goes on the want list.

Good Luck!!

Answer 2

You cannot guarantee a secure future, but you can increase your chances by going to college. Apply even if you think you can't afford it, because you will likely get grants. Community colleges will help you get an education for cheap. Even if you have to take out loans, do it! It is a way to the good life more often than not.

Pick something that you like, but the areas with the most security include education and health care. People who study business can be very successful, but security isn't guaranteed.

A secure future is also easier if you avoid pregnancy before you are ready, so take the right precautions, like abstinence or the pill.

Also, don't worry about having what your friend have. You will never be secure if you try to keep up with everyone else. Don't spend money you don't have.

Good luck to you, it is awesome that you are thinking about this!!

Answer 3

hello, Ive basically outlined what Ive learned and by todays standards i have a comfortable life and not wanting for anything.

well having a 401k is a great idea but you need to make sure the company is secure and a place YOU want to work and invest in as it takes alot of time invested for 401K's to benefit.

you can always save a bit of your money from each paycheck and put in a CD or savings and at least start a retirement/emergency fund yourself.
also if you can tell yourself..this is what i want to do....and truly mean that to yourself, then specialize in that field and the financial security will come with your dedication and hard work.

also don't miss any bill payments for a debt you have taken. create a list and update it monthly like a habit, actually track what you owe and spend a little time each month devoted to your finances. during that time always think about savings and don't go crazy with buying things you don't need or using credit if you can pay cash.

financial security always comes with a good reputation and good credit. as you have proven that you can do what you say.

hope this helps and the best of luck!

P.S. always read the credit card statements as they do tricky things.

Answer 4

You have actually taken the first step - you have consciously decided to not let it happen. From here on out ask yourself a simple question when making a financial decision - is this (purchase, loan agreement, credit card, etc.) helping me achieve my financial goal or keeping me from it? - and as long as financial security continues to be your goal you will make the correct decision. We all hear the little voice in our head when we spend money we shouldn't be - some people are just better at tuning it out than others and by doing so end up spening more than they can afford. Now in order for this "voice" to speak loud enough you have to know your boundaries. If you do not know how much you make then you will not know how much you can spend, if you do not know where you want your money to go then it will most likely not get there, and if you don't set spending limits and financial goals than you will end up achieving neither. Oh yeah - stay in school, get good grades, don't do drugs and stay confident in yourself. I hope this helps.

Answer 5

first of all, the main thing which is very good for someone your age now is to get a quality education, if you are going to school part time, you can as well get a part time job, save some money as much as you can be able to so that by the time you get to 18, you must have had a lot of savings and then you can start thinking of little business ideas which your saving can be able to start for you.
l like it when people shun the use of credit cards, this way, you get to know what is really yours and what is not yours. lf l decide to purchase something that l like, l always like working towards getting the money than putting up a credit basis to myself.
Get enough education, Find a good job, Make some plans for your future, set up a timetable to what you want your life and goals to be like and start working towards it. l wish you good luck.

Answer 6

First, education. Get as much as you can.

Second, don't have kids till you are well established and have plenty of money. Kids are very expensive.

Third, don't blow your money. Put a set amount into savings and don't run up credit card debt. Buy things one at a time as you can afford to pay cash.

Fourth, get a job, maybe two. Work hard and don't be afraid to take on more responsibility. Look for ways to advance.

Answer 7

There are many ways of making money, but it's lack of management of money that creates the problem of the hand-to-mouth situation of which you speak. At your age, you have a golden opportunity to follow a simple, but effective rule: Save 10% of every dollar you earn. NO EXCEPTIONS! -- And spend those savings only toward investments which are most likely to generate further income.

Answer 8

economic stability is a considerable would desire to. this would not advise the guy must be wealthy. basically that they comprehend the place their priorities are financially and comprehend the place they decide to be while they retire and that they are making plans for it. understanding that there is going to be adequate to pay the charges on time and slightly left over for emergency or trip each 12 months is very significant.

Answer 9

Get your education (even if it means taking out a loan for college). Don't spend more than you earn. Save for the future. Pay off your college loan and live wisely by not spending frivolously. That's it, no secret formula.

Answer 10

Budget, put money into savings every paycheck(and never dip into it). Also 401k & IRAs are great for retirement.