You probably didn’t learn about personal finance in school. And if you did, it was probably a boring, lecture-based workshop that wasn’t very engaging or helpful (like the one that inspired our CEO to start Zogo).
But you’re in luck, because I’ve completed enough Zogo modules to know a thing or two about this kind of thing. If you or a young adult you know wants to start getting better with money, but doesn’t know where to start, I’ve got you covered!
1. Budget: This is a critical first step when it comes to managing your money, and it has to happen before anything else can fall into place.
Budgeting doesn’t mean you have to live like a monk or eat ramen noodles for breakfast, lunch and dinner. You can start by just keeping track of everything you make (income) and everything you spend (expenses). From there, you can adjust to make sure you’re not overspending in any one category, and that you’re setting aside enough of your income for savings.
If you’re building a budget from scratch, there are some excellent resources on NerdWallet, The Balance and The Financial Diet’s YouTube channel.
2. Start building good credit. I say it all the time in these blog posts, but it’s that important (and pretty easy). Either during college or before you get your first job, apply for a credit card in your name and start building good credit! That means using the card for purchases you know you can afford, AND paying the bill off like clockwork every month.
Not sure which card to apply for? WalletHub has a list of starter credit cards for you to browse.
3. Ditch your negative feelings about money. Okay, I know this sounds like we’re getting into touchy-feely, self-help territory, but trust me: your experiences with and perceptions surrounding money can have a serious impact on how you approach your finances throughout your life — starting now!
Take this example: My dad grew up in a middle-class immigrant family that was always just getting by. As a result, he fought hard to give his own family a greater sense of stability. He worked long hours at a stressful but well-paying job, hoarded savings and always struggled to just enjoy the life he could afford with the money he’d made.
Now, take my own experience: growing up with a father that was always working and always stressed out, I developed a different perception of money. Of course I want stability, but my ultimate financial goal is freedom: having enough in the bank to give me the freedom of putting other, more important things first — like joy, and family.
Can you imagine how differently my father and I will approach financial decisions over the course of our lifetimes?
It may seem early, but now is the time to get clear on your long-term financial goals. As you transition into adulthood, what will be most important to you? Wealth? Freedom? What experiences have shaped your perception of finance? Why do you think you’re inherently “bad” or “good” with money?
Getting your financial life together can seem daunting, but I promise it can be kind of fun. This is YOUR money! YOUR life! Independence and freedom awaits!
Don’t worry, I’m still a financial work in progress too. And I’m off to make some ramen noodles for breakfast…