As a personal finance blogger, speaker and author, money has dominated most of my thoughts for years. Even more so while I was working on my upcoming book: “Broke Millennial: Stop Scraping By and Get Your Financial Life Together.”
Here are 19 of the most important lessons I’ve learned along the way.
1. We need to talk about money.
Money is still way too taboo. And the only way we break down this wall is to open up dialogues with friends, partners, parents—anyone who’ll listen, really. Having honest conversations about salaries and negotiation techniques with friends and co-workers is what helped me learn how to advocate for myself.
2. We will mess up—probably more than once.
Whether it’s a small misstep, like an overdraft, or a big one, like defaulting on your student loans, we will trip up. But it’s never too late to turn things around.
In many cases, getting back on the right track—and successfully managing our money over the long term—is as simple as committing to periodic financial check-ins. A friend once had a $25 medical bill end up in collections because the doctor’s office never contacted him to ask him to pay it. Fortunately, he found out about it during a routine credit check, and was able to immediately pay it off and repair his score before much damage was done.
3. A weekly budget meeting can help, too.
Every Sunday, I sit down for 20 minutes to crunch numbers from my bank accounts and credit cards. This gives me a chance to course-correct if I’m overspending, and ensures I’m on track with my short, medium and long-term financial goals.
4. Short-, medium- and long-term savings goals are equally important.
We often get too fixated on big goals—like putting away money for retirement—and don’t give enough attention to smaller targets, like saving for a trip to Italy or for a home down payment. But I’ve learned to make a conscious effort to have a healthy mix of goals, especially after realizing that accomplishing bite-size goals keeps me motivated to stay the course and hit bigger ones.
5. Tracking your net worth keeps the big picture in focus.
In addition to that weekly budget meeting, I also run my net worth update once a month. Seeing the consistent march upward also keeps me inspired to continue aggressively saving.
6. Compound interest is the eighth wonder of the world.
Not everyone feels weak in the knees about the glories of compound interest like I do. But come on, it’s what enables you to grow wealth with pretty minimal effort and consistent contributions. Contributing to a 401(k) is a simple way to get started. I also invest in a mix of low-cost funds.
7. So long as you’re on the right side of it.
While compound interest can do wonders for your investments, it can also sink your finances if you’re on the wrong end of it. If you tussle with credit card debt or loans, compounding interest is the reason it feels like you’re in a black hole of bills—regardless of how much you pay.
8. Time is money.
DIYing everything may save some pennies, but is it always worth the time and potential aggravation? I’ve calculated my hourly rate—including living expenses, health insurance, taxes and my business operating costs—and use that to decide when it pays to outsource. I’ve learned that the hours I can add back to my schedule each weekend is well worth the cost of drop-off laundry service.
9. You are your best investment.
Whether it’s updating your skill set with professional courses, purchasing professional clothes for a big interview or taking the leap into entrepreneurship, it’s important to invest in yourself. I’ve spent the last three years building a steady stable of freelance clients, which eventually helped me leave my full-time job this year. (Bonus: Building my brand over the years also earned me a book deal.)
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