After having worked for a decade, I can say that I am obsessed with money. How to make more, how to save more, how to be more minimalist, how to get the most bang for your buck – you name it, I’ve probably tried it out. Now that I am in my 30s, there are 7 financial tips that I hold close to my heart and will probably practice for the rest of my life. I learned some the hard way, and I have practiced a few since I was a child.
Here are the 7 financial tips that I recommend for every young woman to consider:
1) Write down a monthly budget goal
For the past decade, I have kept a special notebook dedicated to calculating my finances. At the start of every month, I do a budget forecast for the month.
I write down my upcoming expenses, like my usual bills and anything miscellaneous, such as my annual car insurance or a friend’s birthday.
I also write down a goal figure to save at the end of the month. For example, if my goal is to save $500 dollars a month for the year, I would write down the figure “500” for 31 January, “1,000” for 28 February, “1,500” for 31 March, and so on.
This way, I am reminded that there is a sum in my account that I absolutely cannot touch unless a medical emergency comes up.
2) Keep an expense tracker and be diligent about updating it
It is easy to spend money when you do not keep track of where it goes. For a while, I was wondering why I kept having only a hundred dollars to my name within the last week before my salary arrived.
After checking my spending habits, I realised it was due to my sweet tooth and tendency to buy myself treats when I was stressed. I have now set a daily food budget, and I only allow myself to buy certain treats occasionally if I have underspent on that budget for the week.
3) Pay off your credit card ASAP, or just don’t get one
I didn’t have a credit card until I was in my late 20s. My current habit is to check my credit card account daily, and to pay off any transactions that appear immediately. Otherwise, it can be easy to overspend thinking you still have money when you don’t. I am proud to say I have never incurred credit card interest fees, nor do I ever intend to.
4) Don’t do instalment plans unless you really need it
I used to love the 0% interest free 12-month instalment plans on e-commerce and company websites.
Well, that was until I realised that I had to keep accounting for this extra sum for an entire year ahead. Things I thought I could afford because of the instalment plans were not really things I could afford at the time.
I now avoid doing instalment plans and go for paying immediately if I can, unless it is a big-ticket item like a laptop or a car. I need these items to continue working, so these purchases are an investment for my career.
5) Keep separate bank accounts for different purposes.
Another great financial tip is I have two separate bank accounts. One is for receiving my salary and to keep my savings, and the other is for my spending.
I normally access the salary account once a month. Then, I move the money I know I’d be spending that month into my spending account. I pay off all my bills first before having food and fun money.
6) Don’t try to keep up with the Jones’, or cave into peer pressure
This financial tip is not too obvious but a real saver if you can adhere to it. When you get promoted in your career or receive a raise, it is easy to feel like you “deserve” better. I felt like that in my early 20s.
While I did not crave for designer bags or expensive clothes, I fell down another rabbit hole instead – indiscriminately buying things I found “cute” or just because I felt like I wanted them. It was so easy to tell my peers about what I got that week from shopping.
All I ended up doing was a quarterly spring cleaning of all the things that I bought, which wasted money.
7) Keep learning and upgrading your skills to demand a better salary or start a side hustle.
My final financial tip is never stop learning new skills. Just because you are not in school anymore does not mean you get to kick back and relax. If you want a better income – which we all do – it is best to stand out from the crowd and be able to add more things to your resume.
Even if it is not career-related, your newfound skills might lead you towards a side hustle or a new business that you can start on your own.
Here’s hoping the roads you take will lead you to more financial stability.