We all love money, and what could possibly be more fun than spending all of that glorious babysitting or hostessing money? Believe it or not, saving those funds to be used another day not only feels good, but can put you on the right road as far as your future money management is concerned.
Why Manage Money?
You’re young – you should be carefree! Guess what? When you’re older, you’ll want to be carefree then even more. Right now, presumably your parents are footing most of your bills and providing your food. As you leave home to go to college or to pursue your other career goals, you’re going to find yourself in a state of limbo. As the money comes in, you’ll need to make it last for weeks, even months at a time and if you’re not sure how to handle your finances, this can be tricky. Once you’re working steadily, the last thing you want is to spend all of that hard-earned money on old credit card bills when you could be using it to travel and live nicely.
The earlier you start saving, the more time your money has to work for you. And unless you’re in a pretty tight spot at a young age, you have way less to pay for now than you do when you’re facing a mortgage, car payment, insurance, childcare and all of the other bills that most adults are paying every month. So use this time to your benefit. For every paycheck you get, put 10-20 percent into a savings account right away. Let’s say you get $100 for a nice babysitting job. Instead of rushing out to spend your $100, put one of your $20 bills into the bank or into a sealed jar (for now – not a good longterm plan) and then use that $80 to enjoy for whatever you need it for.
If you save $20 every weekend that you babysit, pretty soon you’ll be looking at hundreds, even thousands of dollars in reserve. Talk to your parents or look on the website of local banks to see what your options are for long-term savings at a higher rate. You might opt to invest those savings in the stock market as well, but plan on leaving the money there for a long time. Perhaps it can cover a big trip when you graduate or be the down payment on your first house. You might use it to help buy a car someday. Who knows, but you’ll have plenty of options if you have cash in hand.
Live a Carefree Life
There are enough challenges as you grow older – you don’t want to worry about money all of the time. Part of managing your money is figuring out how much you actually have to live on each month. When you get your first paycheck and start planning for your apartment and living expenses, look closely at how much you get to take home from that paycheck and how much you’ll need to save each month to stay at 10-20 percent. Then, figure out how much you can spend on your home, your car and all of your other expenses to be sure you have enough left over to play with, too.