People of all ages at times wish some of the lessons that were taught in school related to real life experiences. Many individuals of all ages apply for mortgages while nearly nobody uses imaginary numbers after their academic portion of their life is over. Unlike previous generations there is the ability to educate oneself without heading to the library or consulting an expert on a specific subject. The excuse of not being taught certain personal finance strategies falls directly on an individual with the plethora of information available online. Taking a proactive approach in educating yourself in personal finance can change the way you look at the way you are saving and spending your money. Below we will delve into personal finance strategies and tips that many of us wish they taught in school.
A Second Stream Of Income Is Important To Pay Off Debt Fast
The freelance economy is currently very healthy with a plethora of skills being in high demand. Being able to pick up a few clients to work on a project by project basis or hourly can help knock out debt fast. Keep in mind that you will still be paying taxes on the excess money earned so put some aside so tax season doesn’t end up as a nightmare. Commit a certain amount of time a week to working this second job as this will reduce interest that will have to be paid otherwise. People often times put extra money towards their mortgage per month to pay off the loan years early. Side gigs are more commonly taking over as full-time jobs if they are profitable enough. This also provides financial security in case you are terminated at your current job or lose your job due to budget cuts. A second stream of incomecould totally change your quality of life and eliminate worry about finances.
Protecting Your Personal Assets When Owning A Business
Protecting your personal assets when owning a business is important as actions that are not your own can impact lawsuits or other issues businesses encounter financially. Forming a LLC as well as investing in surety bonds as a form of insurance financially is very wise. Taking the time to have legal professionals write out standard contracts is imperative as well. Details like that of payment schedule being ambiguous can lead a company to delay payment if they are having in-house financial issues.
Living With Your Parents Can Great To Save For a Down Payment On A Home
Spending a few years saving money on rent by living with your parents has been looked down upon. This can be the perfect way to save up for a down payment on a home depending how long you decide to stay or how long they allow you to stay. Saving on expenses like that of the water bill or on groceries are also costs that can be saved on as it is not just the rent.
Stop Eating Out Due To Laziness
The amount people eat out and the ease of order food have both hit the highest level of all-time. The amount of money spent on entertainment needs to be limited if struggling financially. Saving money monthly is quite easy when eating meals at home that you have cooked instead of ordering or going out to eat multiple times per week. If you are going to go out go to an establishment with a deal that particular night whether it is the famous Taco Tuesday or Wing Wednesday. Creating a meal plan can allow you to prep food so you can just pop it into the oven or put a few ingredients together then eat. After a long day at work it might seem like an impossible task to prep a complex meal so handle it on your easier days at the office or on a weekend.
Start Investing Your Money
Allowing money to sit in a banking account is not allowing your money to truly work for you. There are dividend stocks that can be invested in that have earned a return for years on end. If you work in a specific industry you might know which companies look like they would be a good investment going forward. For example, a person working in the media would understand which publicly traded companies to invest in that have large media holdings. Take advantage of knowledge that you already have then diversify as you do not want one industry crumbling to take your financial health along with it.
Financial literacy is as important as ever especially with all of the convenient bank, trading, and investing platforms available. They might not have taught certain lessons about how to do your taxes in school but take accountability by teaching yourself. Understanding what to do with your money is far less stressful than making a decision then hoping for the best.