Personal Finance Advice From Someone Who Sucked At It
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wongAspiring dog owner
Autoplay OFF  •  a year ago

Personal Finance Advice From Someone Who Sucked At It

by wong

I moved out on my own when I was 18.

With the money that I made from the companies I started, I decided to move away from home and explore life without their help. The new sense of freedom was amazing, until I used up all my money.

1. Learn to budget and reduce your expense

Budgeting helps you eliminate unnecessary spending. It is important to do this once every few months or as your income changes. After you budget, set a goal (retirment, buy a house, etc)

2. Build an emergency fund

An emergency fund should be a relatively liquid sum of money that you don't touch unless something unexpected comes up. Save enough to help you survive 3-6 months.

3. Pay down high interest debts

Use your extra money to pay down your high-interest debt (e.g., debts much over 4% interest rate).

4. Maintain a good credit score

If you are a student, most banks offer a 1-year interest-free​ credit card. Take advantage of that and use it to make small purchases, and pay it off on time every month.

5. Don't Change Your Lifestyle Based on Your Current Income

A lot of people make the mistake of spending more money and living more lavishly as soon as they are having higher income. This is dangerous because incomes are volatile.

6. Put 10% in Savings

Not really a general rule, but personally I would put 10% of every paycheck to my savings account. It seems small, but it slowly builds up and can act as an emergency fund.

7. Check to see if you are eligible for tac deductions

You may qualify for tax deductions if you spent money on taking classes, your hobby, and many other things!

8.Don't lease or rent things unless you have a steady income

Leasing or renting means being committed to paying for it for years down the road. If losing your job means that you won't be able to pay for it anymore, perhaps you should seek other options.

These are all the things that I learned from my mistake

Hope that help you!

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bernardtwindwilGold CommaGranddad & story teller, tomthepo8.com
a year agoReply
Great advice. Every parent should hand this advice from you to their children as they prepare to walk out the door. As this advice comes from a member of their peer group, it will have more impact than coming from Mom and Dad. These are pearls of wisdom.

erofaerSilver CommaHow can I be impressive in one sentence?
a year agoReply
@bernardtwindwil seriously I need to know. Actually I just want to know. No offense but it sounds slightly judgmental, I'm not sure whether that was you intention or not.

sydneyVerifiedco-creator of Commaful
a year agoReply
@wong the asian RETURNS!!! :) great advice...advice i wish i took haha