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MARCH 2018
Five Fundamental Financial Tips for Young Adults
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April is Financial Literacy Month! This month's Five on the Fifth outlines five fundamental practices to help young Mainers achieve financial capability.
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1. Learn to wait.
Some of us learned this skill from our parents, while others learn through trial and error. Either way, once you learn the art of delayed gratification, you'll be better able to keep your spending under control and create a life of financial freedom. Try avoiding impulse purchases, no matter how large or small. Before purchasing something, wait a day or two. Avoid using credit cards to purchase items that you can’t afford.
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2. Take control of your finances.
Learning to manage your own money is a powerful first step toward financial independence. Though it is sometimes easy to rely on others (parents, friends, and relatives), take charge and work to develop your own financial knowledge. Small steps like reviewing your online bank statement, completing your own
FAFSA, and reviewing your annual credit report will help you better understand how finances work. Take advantage of FAME’s
money management resources to help you get started.
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3. Identify your spending leaks.
Without even realizing it, many of us spend a lot on inexpensive items such as coffee, meals out, entertainment, clearance sales, and personal habits. These small purchases add up over time and can become a big problem. To get this spending under control, you’ll first need to identify the problem items. Track ALL of your purchases for an entire month, no matter how small. After a month of tracking, add them all up to identify your personal spending leaks – you might be surprised to see where your money is going!
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4. Start an emergency fund.
There's no time like the present to start saving. Establishing a habit of saving is important, even if it’s just a small amount. Savings can help prevent a dependence on credit cards and lessen other types of borrowing. Plan for the unexpected and begin saving in an emergency fund. If you don’t have any savings now, start with a savings goal of $500 and build from there. Once you establish a savings habit, before you know it you’ll have well-established emergency fund and can start saving for big things like vacations, a car, a home, and retirement!
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5. Discover "found" money.
Think about ways to increase the amount of money that you have to contribute to savings and pay off debt. Start with these strategies:
- Get the Best Deal - Review your regular monthly expenses such as cable, internet, cell phones, insurance, and banking. Most consumers select a product and stick with it without researching other options. Often, there are lower cost options that could save you HUNDREDS of dollars. Set aside time to research and negotiate the best deal.
- Raise Cash to Pay Off Debt or Kick Start Your Saving - Most of us have households full of items that we don’t need or use and it’s easier than ever to sell unwanted items. Video games, musical instruments, athletic equipment, appliances, DVD’s, collectibles, etc...can all be sold for real cash.
- Create a Side Hustle - Generate extra income through your interests, skills, and talents. Babysitting, yard work, photography, and tutoring are just a few examples of ways to earn extra cash!
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Join us for this month's
FREE
Wednesday Webinar:
Financial Fundamentals for Young Adults
First Steps towards Financial Wellness
Wednesday, April 11 • 10:00–11:00 a.m.
The ability to successfully manage your finances is one of the most important factors for lifelong success, and there's no doubt that Maine's youth need financial education to help guide them on their path to financial wellness. During this webinar, participants will learn the first steps for helping youth achieve financial capability, along with an overview of helpful resources to support them along the way.
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FAME's College Access and Financial Education Team:
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The Finance Authority of Maine (FAME) does not discriminate in the administration of any of its programs or in its employment practices on the basis of race, color, national origin, age, gender, religion, physical or mental disability, political affiliation, marital status or sexual orientation. FAME is an equal opportunity employer, provider and lender.
FAME provides links to other websites as a convenience and does not endorse or guarantee the content, accuracy or usability of such sites.
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