Friday, August 15, 2014, AM | 1 Comment
It can be tough to effectively save and manage your money during college while you try to juggle everything else, and you likely aren’t making much money while going to school anyways. However, once you get a job after graduation, the paychecks will start rolling in.
As a college graduate, and an adult, you need to get organized so that you don’t mismanage the money you do have.
While there are plenty of adults who mismanage their finances, you need to get serious about how you handle money because you are no longer living for the moment—you are planning for the future.
Keep reading for a “grown-up” guide for managing your money by adopting a few financially healthy habits.
In our world today, both men and women must become financially accountable enough to stand on their own monetary merits.
While partnerships sometimes manipulate couples into becoming reliant on one another’s income, it is crucial to maintain an independent identity, financially.
This also means making, spending and saving your very own dollars and not depending on parental support or family inheritance as well.
If you can successfully set yourself up and prioritize effectively, you are on the path to proper money management.
Knowing that you are fully in charge of your finances gives you a sense of responsibility that falls to no one else.
Grasp the Necessity of Insurance
Insurance is one of those adult basics that can be overlooked to your financial detriment. Insurance is important because it protects everything you’ve been working to acquire.
Providing for yourself and your family in the event of an accident or disaster at the very least will keep a roof over your head, money in the bank to survive, and assurance that when events happen, you will financially preserver.
It’s a good idea to form a personal relationship with your insurance agent so that you can turn to him or her for advice and to answer your questions.
Do Not Live Beyond your Means
During your college years you likely made sure that your rent and tuition was paid, and then checked your bank account every so often to make sure that you had enough in your account for Friday night movies or pizza.
Now that you are a financially independent adult, you need to be fully aware of all your expenses and pay attention to where your money goes.
By setting up a budget and sticking to it, you’ll be able to live within your means, which is what financially responsible adults do.
When you create a strict budget and use online banking, you can be fully aware of where your money is coming and going in order to live within your means.
Having a set budget will keep you from using credit for buying things you “want” or justifying unnecessary purchases.
It’s also a good idea to allocate a portion of your paycheck to go to your savings account so that you can live within your means and save for the future.
Understanding the Psychology behind Money
In order to form good habits, you must first understand what bad habits you might have. Maybe you are always late on your bills, or you buy the “wants” before the “needs.”
If you can admit your weaknesses when it comes to money, you can analyze what resources can best help you on your way to financial freedom.
There are plenty of budgeting or money management apps and websites that will give you financial help at the tap of a button.
Whatever your downfalls may be, you must pinpoint them in order to understand the areas where you could be lacking, and replace those poor habits with good ones.
U.S. statistics show that Americans spend somewhere north of $469 billion dollars annually on Christmas alone. That figure breaks down to somewhere around $800 per person with 30% of people each spending over a $1,000.
If you were financially supported during college, or spent your money however you wanted, you might need to get used to living a different kind of lifestyle.
Celebrating responsibly means approaching birthdays and holidays with conscientious consumerism, and a list. It goes back to the idea of prioritizing wants and needs.
If you go overboard with spending on every holiday, you will undo all of your hard work you’ve done to become financially independent.
Likewise, if you are used to rewarding yourself for working hard with vacations or extravagant “treat yourself” days, you will need to scale back in order to be able to relax and celebrate in later years, instead of worrying about money.
Much like a physical diet, healthy financial habits are successfully materialized through making small, diligent choices with money every single day.
Foregoing extras that don’t actually make you happy can easily be replaced with meaningful ways to experience life, without blowing money.
As you enter the real world, you’ll need to reevaluate your budget, spending habits, and other financial choices.
But as you start earning more money and learn how to properly manage your finances, you will feel a sense of control over your life—rather than being controlled by money.
This article was written by Dixie Somers, a freelance writer who loves to write about business, finance, and women’s interests. She lives in Arizona with her husband and three beautiful daughters. Dixie got her advice about insurance from the professionals of Underwriters Insurance Brokers Ltd., who specialize in insurance for home, auto, life, and more.