5 Money Habits I Have Established In My 20s For Better Tomorrow
Developing financial success.
Growing up, my money habits were shaped by the modest means of my childhood. While we weren’t millionaires, we had enough to cover our necessities and enjoy occasional indulgences.
As I approach my late twenties, I’ve become increasingly aware of the profound impact my financial decisions today can have on my future. With the abundance of wisdom shared by financial influencers on platforms like YouTube and Instagram, I’ve gained valuable insights on securing my financial well-being.
I’ve combined nuggets of wisdom from global financial moguls with personal insights to break free from detrimental money habits and pave the way for a brighter financial future.
Intentional Purchase Planning
For impulsive buyers like myself, planning purchases is the key to regaining control over our desires. We often encounter clothing, jewelry, or furniture items that we yearn to add to our collections. To avoid succumbing to impulse, I’ve adopted a strategy of saving specifically for these desired items.
For instance, if a product is priced at $1200, I divide the amount into smaller portions and save monthly or weekly, such as $400 over three months or $200 over six weeks. This approach not only increases my awareness of my expenses but also safeguards me from unnecessary purchases, even when I have the financial means to make them.
Cultivating Objectivity in Money Habits
Denying our financial shortcomings only hinders our journey towards better decision-making. While it’s natural to make excuses for past mishaps, it’s important to recognize that we can’t afford to jeopardize our entire lives through repeated errors.
This self-reflection becomes particularly meaningful when we realize that without substantial investments and savings, our financial security would be vulnerable to unforeseen circumstances.
As an adult, I’ve embraced the reality of my impulsive buying tendencies and acknowledged the wasted money on unnecessary indulgences. It takes courage and honesty to reflect on and accept our money-related challenges.
Empowering Expense Tracking
I know it may sound trivial, but bear with me. Tracking expenses for a month or two can be a transformative learning experience. It involves diligently recording every single purchase, including even the seemingly insignificant ones, like a $5 coffee or a small treat at a favorite café.
At the end of the month, tally up all expenses, including rent, bills, and miscellaneous purchases. You’ll likely be surprised by the total sum and discover that your expenses often exceed your income. This exercise unveils the true impact of seemingly inconsequential purchases, enlightening us about our financial well-being.
Directing Money to a Purpose
Idle money tends to find unworthy destinations.
To counter this, I’ve adopted a budgeting strategy that allocates specific purposes for every dollar I earn. Whether it’s covering expenses, saving for a vacation, emergencies or acquiring a desired item, I assign a purpose to each coin.
This approach eliminates the risk of wastefulness, as any deviation from the allocated purpose hampers the achievement of our goals. By giving a clear objective to every dollar we earn, we maintain financial discipline and focus.
Establishing Boundaries
We all have best friends and family members who occasionally need financial assistance. However, continuous reliance on borrowing can disrupt our budget. Even during social outings, it’s crucial to choose affordable venues instead of going to expensive places that could leave us financially strained.
It’s essential to set boundaries both for ourselves and others. Personally, I’ve determined a spending limit for individual items and outings with friends and family. Additionally, I communicate clear boundaries with others, ensuring that expenses are not always deducted from my account during brunch or other gatherings.
I hate learning a lesson twice for every mistake I make I go back to the drawing board and revise existing strategies or create new ones to avoid repeating the same errors.
Improving financial habits is an ongoing journey that demands self-awareness, discipline, and careful planning. I have witnessed significant progress in securing my financial future. Embracing these practices not only helps us make more informed decisions but also empowers us to achieve our financial goals.
What are the money habits you have embraced at your age. Share your wisdom.
