(Prosperity)
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Anyone can and will make financial mistakes.
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Pay yourself first. A trusted financial advisor tells us this is the first thing she tells her clients. Basically, before you pay out your cash, but a little away for yourself in a savings account, or some sort of security.
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Women control $3.3 trillion in domestic spending. Recognize the power you have over and with your money.
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Start out looking at the big picture, as well as where you are now. Setting goals will help steer you when you’re making the big decisions, like investments, picking 401(k) options and incurring debt. For more ideas of things to do for financial well being, check out What To Know, By Age.
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Respect and remain true to yourself. Don’t let your ego get in the way now of where you want to end up. Remember that your net worth is a lot more than your material possessions (or even your bank account!).
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Before you invest, have a cushion in a savings account. Once you have enough money to live on for three to six months, you can take risks with other investments.
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For most people, all you need is the right fund. Bankers suggest you leave individual trading to the experts.
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Speaking of Investing:
- Think long term, and plan ahead.
- Diversify – that whole thing about the eggs and basket.
- Resist Temptation – think of the donut/muffin rule. A donut is sweet upfront, but there is really only one way to eat them; they’re full of sugar and fat and won’t last past long past the purchase day. Pretty much just like all those Krispy Kreme© shares. Muffins, on the other hand, last a few days, plus you can serve them in different ways: heated up, with butter or jam. If you avoid the “sweet” deal that seems to good to be true, you’ll save yourself a lot of heartache. (This rule also works for dating.)
- Speaking of Krispy Kreme© – don’t buy stocks emotionally. The exception to this is Socially Responsible Investing, and there are experts to help you ferret out the right choices. Learn more about your emotions and your relationship with money.
- Know the risk level of any investments you make and know your own level of risk. This will be unique to you.
- Always be aware of the fees. Bankers and altruism are not synonymous. The people who manage your money want a cut, and so does your government. Look for investments and funds with low fees.
- Never invest more than you can afford to lose.
9. The Wall Street Journal writes to an 8th grade reading level. Bet yours is much higher than that! Don't be intimidated by a brand when it comes to your power over your money.
10. Always sign up for 401(k)s as soon as you can. Even if it’s just $20 or $50 a month. And keep track of them when you switch jobs. This is part of your compensation package. Don’t ever leave money on the table.
11. Try to avoid usurious lending. Ideally none of us would be carrying debt on a credit card. But debt happens. So understand how the credit card system works and the importance of your credit rating.
12. Save, not borrow, to consume. Want a nice vacation? Plan ahead and save up for it. It will make the trip that much more rewarding when it happens.
13. Going on vacation? In Getting Started: The Financial Guide For A Younger Generation, Brian Jones, CFP, recommends the 5 percent rule when planning a years worth of vacation. Don't spend more than 5 percent of your annual salary on vacaion. Have children? Take $2000 off for each child.
14. Try to reserve any borrowing for capital spending.
15. Try to save rather than splurge. In an IRA, mutual fund or savings account, that same $2000 you spent on the Lanvin bag will be worth a lot more in 10 years. Not as pretty or as much fun now, but definitely the wiser move. ( Plus, do friends really let friends pay retail? If your friends aren't looking out for you, learn more about getting deals online here).
16. Protect your credit rating, if you can. We may have mentioned it before - debt happens. If you have to go into debt, do it as wisely as possible.
17. If you’re in a committed relationship, make sure you know where all the money is. For more information on how to talk cents with your significant other, read “The Money Talk.”
18. Keep a list of all accounts and contact information. Don’t let tragedy leave you bereft and clueless. For crucial information on surviving disaster and major life events, check out our survival guides.
19. Learn to cook. Or at least develop a wide repetoire of sandwichs. Brownbagging lunch to work could mean an extra $30 to $50 dollars in your pocket a week. Generally, preparing a meal at home costs 1/3 the price of the same meal in a restaurant.
20.. Know all the tricks – the things all the companies that want your money don’t want you to know. Here are a couple:
- Starbucks has a smaller, unadvertised, drink size. Need your soy no fat venti caramel latte at least every other day, but realize that’s almost $24 a week? Downsize, it’s cheaper.
- Amazon will refund you the difference if an item your bought goes on sale. There is no time limit. Just call and they give you the money back. You can even have them call you – by utilizing the Call Me Now feature on Amazon’s Help/Contact Us page.
- Ask your hair stylist or salon if they do bang trims. These can save you up to 80 percent of a total hair cut.
Got tricks to share? Send 'em our way. We're always looking for more.
