Build Financial Habits When You’re Young – Basic financial education is rarely a required subject in school, leaving young adults clueless about how to manage their money, apply for credit and stay out of debt. To remedy this, states are now adding personal finance courses and/or economics in high school.

While this should help going forward, for everyone who is out of high school, here are tips to help you live your best financial life:

Be prudent. Wait until you’ve saved money for a purchase you want rather than buying it with a credit card the minute you see it. Credit cards are good for your credit score, but using them means you are likely to pay interest on your purchase. Paying with a debit card takes money from your checking account and doesn’t rack up interest charges.

Find impartial sources. Read a few reliable books on personal finance so you have more context for any other information you might hear. That’s important because your finances are a subject that everyone will try to advise you on. Most will have good intentions, but you’ll meet scammers as well, and you’ll be less vulnerable if you have some financial background.

Create a budget. It’s the best way to keep your expenses from exceeding your income. Making small, manageable changes in your everyday expenses can have as big an impact on your finances as getting a raise. Keeping your recurring monthly expenses as low as possible can save significant money over time.

Start an emergency fund. Pay yourself first. Find some amount of money in your budget to sock away in an emergency fund every month before you use the rest of your income for expenses. This will keep you out of trouble financially and help you sleep better at night.

Start saving for retirement. Compound interest works, so the sooner you start saving, the less principal you’ll have to invest to end up with the amount that you need to retire. Company-sponsored retirement plans like a 401(k) let you put in pretax dollars and often match part of your contribution.

Get a grip on taxes. Online calculators help you determine your payroll taxes, showing your gross pay, how much goes to taxes and how much you’ll be left with.

Protect your wealth. If you own a home, your mortgage company will insist on homeowners insurance. But even renters should get insurance.

Work with professionals. Finances are not always a do-it-yourself task. Find a tax professional to help you with your returns and financial planning. You might save money in the long term.

Becoming self-sufficient in the basics of good financial habits can help you create financial stability in your life and become personally prosperous. Develop an investor rather than a consumer mentality to make your money work for you.

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