Tag Archives: Frugality

Do you always see people get asked debit or credit when buying something? Today I’m going to go over that.

Paying in cash or card doesn’t really have a difference until you get into the details of credit history, inflation, availability, and rewards. Now unfortunately minors cannot get a credit card but you can sign up to be a authorized person on your parents card.

Debit

A debit card is connected to a checking or savings account which means the money you use is your actual money. Using debit allows you not to worry about paying off debt on your credit card.

The only negative is that you are using that money now instead of buying something but getting the real money later.

Credit

Credit cards are a bit more complex as they come with terms and such. The premises is this: you are paying with a banks money and you need to pay it back or you will pay a fee if not.

An example of this is you used a credit card to buy a tv which was $1000. At the end of the month you have to use your money from either a checking account or cash/check to pay it off later. If you weren’t able to you would pay more like around 30 for the first late fee.

Using credit cards allow you to build a credit history which lets others to see if they can trust you with their money. You can get better rates if you have a better score.

As credit cards come with different things like rewards or travel points it can become a little more hard to understand. For now I’ll just leave it at that but I could go over this in the future.

Which One?

I personally think everyone should have both, but you have to be responsible and careful when using credit cards. It can be easy to just forget about your payments. The benefits of having a good credit score opens many doors that otherwise would not be available.

Just be financially responsible and you can achieve success while using these tools.

Knowing what you want in general is hard, so how do you know what you want in your financial life?

Whether it’s becoming a millionaire or just having money to spend on traveling, everyone has some goal. They don’t have to be big or crazy it’s actually pretty normal to have a relatively small goal. Let’s talk about what these could be.

Financial Freedom

If you don’t want to live with the stress of having to pay debt or living from paycheck to paycheck this could be for you. Freedom from the restraints of money is possible. It takes hard work upfront but is worth it in the long term.

You technically have to start by building passive income streams while living on below what you make. You save and invest and soon enough you’ll be able to make the choice to work or not.

Still Working While Enjoying Life

Do you want to not have to deal with creating too many income streams or just don’t have the passion to build your own empire? That’s okay because this could be for you. It is 100% possible to work a normal job, work less than 3 days in person, and travel while doing it.

You may have to work a little bit harder in the beginning when convincing your boss to believe you can work remotely. But afterwards you’ll be able to take vacations while not working as much and making the same amount of money.

(Disclaimer only applies to jobs with obvious ability to work remotely.)

Having Money All in a Portfolio

Investing can bring amazing returns, but you don’t have to constantly sell or if you’re just okay with holding and watching for a long time this could be for you. Saving and investing the difference are the basic steps to building wealth. When you invest, or at least when I invest I imagine my money gone because I don’t want to touch it.

If you invest a large percentage of your income into a portfolio, you could gain massive returns but sometimes it takes a few years and a lot of money. If you wait it out and invest in dividend stocks you could receive those on a somewhat consistent basis.

There is always a risk when investing because you can’t predict the market. Always think long term wealth.

Bottom Line

There are many things you can do with your money. It just depends on your goals. These are just the basics that I think and have experienced good returns. Do what would be best for you financially.

There are infinite types of lifestyles, but only a handful will change a cash flow that is negative to one that is positive.

Lifestyle is one of the many unique things about society. It ranges from saving every penny to extravagant living and everything in between. A lifestyle change doesn’t mean to turn your whole world upside down, in fact you probably can just tweak things here and there to create the change in your life.

The Power of a Lifestyle Change

Lifestyle as a teenager will be constantly changing. We experience different things and learn what works for us. We pretty much have a never changing environment. That’s not always a bad thing though, you see when everything changes, including us, we learn new skills and hobbies that we never thought of before.

Starting as a pretty average kid, I went through multiple phases of how I wanted to live and why. I got to better understand me and my goals through the process. I now know I won’t want to attend college but instead pursue a financially lucrative business in high demand. My lifestyle helped me realize my goal and it can help you too.

I started as a kid who believed money is the goal, now I know that it is only a tool I will use to get to that goal. The power of your lifestyle can dictate literally every aspect of your life. Make sure it’s doing that in a positive manner.

Lifestyles Are Personal

Someone my age with a different lifestyle may achieve the same goals I did but they had different things they did that may not work for me. Lifestyles are an intimate part of being human, we all have one even if it seems silent or nonexistent it’s there affecting every decision we make.

A lifestyle is who you are but displayed in your actions. The things you purchase, the way you live, and the habits you have. This is who you are. You don’t have to change you as a person, but changing habits, tweaking things here and there can create the ability to produce more profit.

Inhibit a New Productive Lifestyle

Create a lifestyle that benefits you, just because a lifestyle is a part of you, doesn’t mean it’s good. Make sure it matches your morals and goals and who you want to really be as a person.

A general good lifestyle would include a balance between dedicated focus and bluntness, and a relaxing while taking in life. Anything without balance falls, so make sure you have a little bit of everything to well round your habits.

Being young is hard and made harder when a unhealthy and unsustainable lifestyle is in the mix. Develop good habits so later on you can start ahead of others, and begin your journey to success without too many bumps in the road.

Summary

Start to plan how you want to live as an adult, critique your lifestyle so you will always be successful when achieving your goals. Lifestyles are so unique but certain traits and habits will make an impactful change.

Saving money could make or break your financial situation, learn how to make sure it makes yours.

Starting any job whether it’s a W-2 or a side gig it’s exciting. Seeing a steady flow of money for the first time can produce a euphoric feeling. The first time I got a big paycheck I was so surprised at the quantity. I knew the importance of that money and so I saved it.

How Much Should You Save?

I don’t know what expenses you may have, but I assume you don’t pay for groceries or rent. This allows us as minors to set ourselves up in the future. I don’t have a set savings account as I vary my opinion on how much I should save and how much I should spend/invest.

Some people suggest saving 60% or 40% but I would say saving young and saving more than 50% can create a successful start building wealth. I have set a goal to save up at least 60% if not more of my paycheck because it works for me.

Decide what will work best for you and start there. Don’t feel like you need a fixed savings rate just stay consistent with your savings, no matter the quantity .

Benefits of Starting Early

No matter your age, you can create income. You can set yourself up for when you are legally able to buy property or some type of investment. Creating a savings of at least 10k as a safety net is personally my first goal in regards to saving. Having this net can allow me to pursue more risky possibilities without worrying if I have something to fall back on.

You also learn mistakes that could have been detrimental to your finance in the future but wasn’t because you started young. Overall saving is something that a surprisingly amount of people don’t do, but that doesn’t mean you shouldn’t.

What To Use To Start?

Opening a savings account can be a good way to get tempting money out of your checking account, and somewhere safe. You should research what would be best for you whether it’s an online bank or a normal one look and compare rates.

Never ever open an account that has an annual fee, if it has one go somewhere else. Opening an account is quite simple, but you need your parents information for them to create s custodial account.

Savings as a Whole

No matter how much, savings is one of the best things you can do as a teenager to set up your financial future. Start on a safety net, then if along the way you need a new car or something of the sort learn to save for that the same way for the safety net.

It’s an acquired skill, but an easy one. Start today to set yourself up for success.

Starting young gives you a huge advantage, but if you don’t know how to take advantage of it then what’s the point?

I’m still learning about what I can do right now to improve my future. Looking at what I know right now, it doesn’t seem that complicated there’s just some extra hoops we have to jump through to get started

Building Credit

Getting credit is an important step in the financial world. Being underage it’s hard to achieve it. Credit, for those who don’t know, is a score that keeps track of your financial health and let’s others know if they can trust that you’ll pay your debts.

Fortunately, you can add yourself to your parents credit card as a authorized user. Hopefully your parent have good credit so that when you turn 18, you’ve already built a good credit history.

You can use credit to qualify for a mortgage and getting good rates when buying a car and getting loans.

Learn Negotiating Skills

Getting a job like real estate or sales, negotiating can be a good skill to have when getting or making offers. To learn about this you have to read and research and then get actual field experience.

You can use negotiating to get better deals when refinancing, getting a job, or applying for a loan. You can manipulate the terms for better offers to allow more flexibility financially.

Experience

I assume you don’t really know what you want to do as a career or something to bring in profit. Maybe your oscillating between entrepreneurship or working as a tradesman. Start building experience now. In the process you’ll learn skills that may be profitable in the future.

Under legal guardian care you don’t have financial stress to deal with if you wanted to start a side hustle. You have a business idea? Go for it you have almost nothing to lose except your ego. You want to try out a new job? Who cares if the pays low, you’ll gain experience in the workforce.

Don’t Stress It

Thinking about your future may stress you out but don’t let it. It’s a process you need to learn how to enjoy and use to your advantage. Thinking about possible careers? Research it now see how it could benefit you currently and in the future.

Everything is subject to change and that is one of the only sure things we have in life, use it to create a constant in yours.

Buying things is like a leech, it sucks out all your money and takes it away never to be seen again, frugality is like salt it’ll completely diminish that and save the day.

Growing up I never really had that savings instinct. I would get $20 on my birthday and blow it instantly on something unnecessary. Even today I still battle the constant niggling that I need to buy something. But it’s possible to slowly get used to spending less and less.

How to Start Being Frugal

It’s all just a mindset. You don’t have a biological need to purchase or save money. Psychologically it’s a different story. Everyday we see ads on the new best deals for whatever item. Sales up to 75% off! But do you really need that new object?

Frugality is a skill that can take years to master. You have to think twice before buying something. As a teenager we have no other expenses to worry about, so the only thing we are buying is new things we probably won’t use. This is why it’s good to start now.

When you don’t have to cut out expenses to pay a mortgage it’s pretty easy to stop buying new clothes or tech that really isn’t necessary. I have started looking at where I spend the most money on which would be entertainment and devices. I think to myself if purchasing that item would change my life or bring me profit. If it doesn’t I instantly forget about it.

You can start frugality with the small things. If you only get cash on holidays, save it instead of buying something that will only bring you joy for a few days. It is simple and it will greatly improve your financial health.

Why Be Frugal?

Let’s go to the future. Say you’re now 27 and you have just bought a house. You have a monthly income of about 5k that’s a $60,000 salary. Now you can live like you make a 5 figure salary buying new cars, tv, going out to dinner, and vacations. Or you can live like you like 25k a year saving and investing the rest. Instead of financial independence in 50 years imagine 10 or even 5.

Now I’m not saying don’t buy things or don’t go out to dinner, if that truly would mean something to you then just fit it in your financial plan.

Also if you want to live below your means it doesn’t have to be an extreme gap between your salary and expenses. You could make 50k a year and live like you make 40k. You are still saving it’ll just be at a slower rate. Enjoy life and do what is best for you.

Frugality Long Term

If you’re thinking about your future hopefully it’s long term and not just a year. When you want a long term result you must act in a way that will produce it. You can’t expect that once you reach a financial goal such as a 1 million dollar net worth that now you don’t have to be frugal.

If you continue being frugal you will accumulate wealth continuously to support the lifestyle that you want, but enjoy life in the process.