As a young adult making your way in this world one of the first lessons you need to learn is the art and science of sound financial planning. As a personal financial planner, I often feel that generation after generation seem to make the same financial mistakes and find themselves drowning in debt, living beyond their means and without the financial protection of life cover. How do we help future generations avoid the mistakes that their parents made? I believe the answer lies in education and to this end I have written down all the financial advice I wish somebody had given me when I was fresh out of high school. Your education starts here!
Whether you left school and walked straight into your first job or you went on to university or technikon you need to:
• Live within your means: draw up a budget that lists you income and your expenses. Allocate a monthly amount for food, entertainment, transport costs etc. and do not spend more than you have allocated. It might take a few months to fine tune your budget as your work out what you expenses are, for example how much you will spend on food in a month. The golden rules is to live within your means, do not spend more than your are earning
• Start saving: save some money every month and include this amount in your budget. You should be saving for emergencies as well as putting money away towards your savings goals, for example your next vacation or a new car
• Build a good credit record: pay all your bills on time to build a good credit record for the day you want to invest in property or buy a car
• Manage your debt: the golden rule is to avoid debt at all costs but at the same time you need to make use of credit facilities, be it on your credit card or a store card, to build a good credit record. If you do buy anything on credit make sure that you pay it off in full at the end of the month
• Learn to cook: take-away food and meals at restaurants are a sure-fire way to burn money. Learn to cook nutritious meals for yourself and always pack a lunch for your day at university or at work
• Invest in life cover: too many people make the mistake of thinking that life insurance is only for breadwinners. The reality is that students and young, unmarried adults need life insurance as well. In the event of your death your life insurance pay-out will take care of the cost of your funeral, any costs associated with settling your estate and settle any unpaid debt you might have.
Lastly, if you have started your first job you need to get serious about retirement savings. You are never too young to start building the nest egg that will support you in your old age. Spend some time looking for a reputable financial advisor that you feel you can trust. It is a good idea to speak to friends and family about who they use. Once you have settled on an advisor speak to him or her about how you can start saving towards your retirement.
Learning the rules of good financial planning at a young age will stand you in good stead for the rest of your life. Now get out there and start saving!
Follow the link if you are interested in finding out the cost of life cover.
Article Source: Life cover and savings: my financial advice for school leavers
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ReplyDeleteI will recommend anyone here looking for a loan to contact a loan officer Pedro on Email... pedroloanss@gmail.com