Financial Booboos of the young and inexperienced

Beware youth of the financial independence.

09:16 14 September 2013

In general, young people tend to be daring to the point of being reckless and this perspective may be extended even to their financial decisions. There are so many exciting things that catch their interest, but financial planning may not be one of them.

See if some of the mistakes listed below could be your own.

• Spending everything that is earned.

Raise your hand if you believe that “a penny saved is a penny earned”.  I don’t see hands raising, well because maybe young people never see themselves being in any type of emergency as of yet.  However, emergencies are real and it could save you from too much stress and anxiety if you have saved funds to draw from.  Save even a little amount monthly and just forget about it.

• Credit Card overload

For most young people, having their own credit cards is a sign of moving up and financial independence.  However, if you fail to pay attention to the money-making schemes of credit cards, you can end up in very deep trouble.  Having multiple credit cards can encourage reckless spending which will not only imperil your budget but also your credit rating, if you fail to settle them promptly. Financial planning can help you avoid credit card overload.

• Living life one day at a time

Perhaps, one of the benefits of being young, strong, and healthy does not have to think too hard about the future.  There is a lifetime ahead of us so we can have some fun first.  A lot of older people now could have been better off if they did the contrary and instead set their minds to financial planning for the future.  If there is one thing that can certainly happen, it is growing old and experiencing its corresponding effects.  The sooner we plan and prepare for it, the happier we will be growing old.