5 Money Lessons You Need to Know By 30 | Everyday Power
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5 Money Lessons You Need to Know By 30

Published on October 7, 2015 12:00 AM EST

Money makes the world go around. As much as we hate to admit it, it’s something we all need to survive in today’s modern society. Concerns about money not only causes humans stress, it has also proven to affect their physical health, as well as their relationships.


The American Psychological Association conducted a survey in August of 2014, which found that 72 percent of Americans reported feeling stressed about money at least some of the time during the past month. They also found that some people have even skipped going to the doctor for health care because of their financial concerns. As far as relationships go: “Almost a third of adults with partners report that money is a major source of conflict in their relationship.”


Money affects us all, which is why it’s so important to know how to manage it. There are six important lessons that people of any age can learn in order to help them budget and save, and all them have a little something to do with being frugal.


1. Act like you’re broke even when you’re wealthy.


Frugality is a mindset, one that my parents always engraved inside of me. From a very young age, I watched my mother as she contemplated whether or not to buy a $12 dress from the stylish thrift store in town. I watched my dad shut off all the lights in the rooms nobody was using.


            They did these things, not because we didn’t have the money for them, but because we didn’t NEED to use our money on them. They lived simply and, with the money they saved, they were able to put two kids through school without a single loan or a cent of college debt.


            When you act like you have the money you have, you usually end up spending it all. When you tell yourself you don’t have a lot, you live a more frugal lifestyle, thus saving the money to do what you need to, or truly want to, in the future.

2. Saving a little now saves a lot later.


I learned this lesson when I began thinking about a retirement fund. When I was working on salary, I was told to save 10% of my income, and if I couldn’t afford 10% (which I couldn’t at the time) I was told to put aside as much as I could.


Starting a savings account feels like an impossible feat at the beginning. Putting away $10 or $20 of every check seems pointless. “I’d rather use this for going out to dinner on Friday night,” we think to ourselves. But we have to start somewhere. $10 becomes $20 that becomes $200 that eventually becomes $2,000.


3. Delay gratification.


Instant gratification is a very tempting evil. Most of us are too quick to spend our money as soon as they have it. We say, “It’s burning a hole in my pocket!” We ask, “Why keep the cash when I could have a brand new _____?”


            Material possessions entice us, and it’s no wonder why. Marketing for these shiny items bombard us everyday, through commercials on TV, the radio, advertisement online and in print. It’s an instinctual behavior to crave the material benefits of money as soon as we have a little. If we don’t, we might miss out on the newest gadgets or the nicest clothes.


But instant gratification is no friend to our future selves, surrounded by fancy things but can’t seem to come up with rent for the month.


Learning to say no to instant gratification is not easy; however, it might be necessary in order to afford the lifestyle you hope to one day live. Financial security is much greater, and more satisfactory, than instant gratification.


4. Buying “things” won’t fill a void.


A big reason people rely on instant gratification is for the immediate satisfaction it gives us. Look at compulsive shoppers. They buy whenever they feel stressed, or upset… even when they’re upset about their financial status. In those cases, it goes full circle.


Money affects our psychology. It can blind us from the true root of our problems, and it cannot fill the void we feel inside ourselves. In fact, buying too many things will actually create a void, in our bank accounts.


It’s important to figure out the real cause of your unhappiness. Is it discontent at work? An unfair salary? Is it a broken relationship? Is it your body image? Or your location? Or your lifestyle? The only way money might help you solve these things is by spending it wisely, either on a new hobby or a vacation or a little self-care.


5. Know how much you’re spending and what you’re spending it on.


Often times, we don’t even realize where this week’s check has gone. It’s important to keep a list of how you’re spending your money each month. If you have a credit or debit card, keeping track is much easier. If you strictly use cash, create a written list of what you bought at the end of each day.


You might realize that you’re spending way too much on coffee, when you could just make a cup at home. Laying your finances out in front of you makes the spending much more real.


Only then can you begin to make the changes necessary to help you budget and save.

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