FREE MONEY
Before anyone gets any preconceived ideas of what this entry might be about I want to clarify that it is simply a typical rant about a pretty beat to death topic... Money. I am not a financial adviser so take all of the following with several grains of salt.
Whether you grew up rich or poor money played a big role in your life. As a kid you are so excited to get your first dollar from the tooth fairy. You race your friends to go pick up a quarter on the sidewalk. You open birthday cards to numerous presidents face whom you could care less about, chucking the cards to the side, and stacking crispy bills to count at the end. As time went on though you realize that money becomes more and more a part of your everyday life.
Can you remember your first self-purchased meal? Did you get any extra bacon on that burger when you were twelve going out with friends for dinner? We quickly realize that this resource is finite and powerful, however, all to scarce for us to live the way we'd like. Sure you can cite examples from your life or others in the past and present that live off little to no income... shove it. I am speaking about the OVERWHELMING majority.
If you were/are fortunate enough to attend a college you know that tuition costs more money than you probably earned in a 5 years of part-time work. You get letters in the mail for credit cards and you spend your time scanning websites or wandering aimlessly in stores. But you have to be careful with so much spending power and so little supervision.
Having a credit card is unfortunately becoming a requirement. You need to built credit in order to own a house, get a future loan, or emergencies that may creep out of no where. But, this doesn't mean you need debt. My own spending rules are as follows:
- Use your credit cards as you would cash or a debt card. Do not spend excessively. Make sure your checking account can cover any and all credit card expenditures and still have enough for rent/food/bills.
- Pay your credit card off in full every month. NO EXCEPTIONS (unless it is health related and you have no other option). Credit cards offer between 1% to 6% back on most any purchase, that is 10x the interest on your savings account! If you instead opt to only partially pay your credit card you will be slammed by 10-22% interest rates!
Save for big purchases and do not get antsy. The best and most vague words of advice I have for anyone in regards to money is "Money comes and money goes". There will be times when you are hurting and eating ramen and there will be times to drink wine and eat dry aged steaks.