We all learned about money in one way or another as children, but when you become an adult, the rules of money change drastically. There just isn’t as much wiggle room as there was when you were a teen or a young adult. There are always new ways being discussed how to save the most and how to create a financially stable future. While we may not be able to give you all the answers, there are a few things that we think everyone should know about saving that will benefit your family in the long run.
Locating and Limiting Unnecessary Spending
It can be very easy to get caught up in today’s society. Everyone is all about having the best of the best, upgrading to the newest, fanciest, and most desired products, from the cell phone you use to the car you drive and even the home you decide to purchase. When trying to keep up with the Joneses, it’s easy to forget to pay attention to the minor details. That $5 monthly fee you pay for your checking account? Well, while it doesn’t seem like much, that mere few dollars a month quickly becomes $60 a year and $300 over five years. That car insurance that just doesn’t seem to lower drastically enough even though you’ve been with the company for a very long time may have great customer service but if you are paying far more by sticking around, it may be time for a change.
That’s the trickiest thing for many people to do, is allow change to occur as necessary. Sometimes opening up a different bank account, taking the time to place money in a CD or saving account, and starting a college fund for yourself and your children seems impossible but every dollar – every penny – adds up, so now is the perfect time to start. It’s never too early, and it’s definitely not too late.
Being Cautious with Loans
As you get older and have an increased number of financial responsibilities and needs, loans often become a part of everyday life. It may not be that you haven’t planned accordingly, it’s just that things such as schooling, purchasing a car, and buying your first home isn’t exactly cheap. No matter what type of loan you are looking for, it’s important that you shop around. Some lenders are going to offer lower monthly payments, lower interest, or even lower initial charges.
When looking for a car loan, be realistic about the vehicle you can afford. Many people purchased based on looks, but focusing on things such as reliability, mileage, and maintenance requirements is a much smarter way to go. When it comes time to purchase a home, you want to find a mortgage that is about one-third of your total monthly income. This way you have some wiggle room in the event you do not make as much during a certain month. It’s also important to ask lenders about potential prepayment penalties and when able, placing additional money towards your principal so you can get out of debt faster.