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Money management is so important, but honestly, most of us suck at it. Like really suck at it.
We know what we need to do to have better money habits. We know what our financial advisor wants us to do to set ourselves up for success in life.
But, we also know we definitely shouldn’t buy that new whatever– but we totally are.
We want it all. We want to be able to buy what we want now and also be able to have have relaxing and stress-free retirement.
But we need to make sure we aren’t just swiping credit cards willy-nilly and are making enough money to cover excess expenses and help us prepare for later in life.
SPEND YOUR TIME BETTER
When I was in college I worked about 8-12ish hours a week at my college-long job at Abercrombie and Fitch. However, towards the end of college, I would maybe work 4 hours a week. This was mainly in part to me just not wanting to work more hours.
At the time I convinced myself that I “didn’t have time” but in reality, I just didn’t want to work. I would rather spend all day lounging around with my friends or off on some adventure.
Don’t get me wrong. I am glad that I got to spend so much time with my friends before a full-time career hit me, but I had some time that I could have spent more wisely.
Instead of spending my days where I was out of class by noon lounging around my apartment I could have been working or doing something to help me make more money or better myself.
Instead of nursing a hangover all day on a Saturday I could have been more responsible with drinking the night before so I could work during the day.
You see, I still could have done everything I wanted to with my friends and been more responsible with my time.
It is all about finding the balance.
YOU DON’T NEED IT
When I was in college I would spend money like no one’s business on things that I didn’t need.
Especially “going out clothes”.
I would convince myself that I needed something new to wear out to the bars.
If I a “bad week” I told myself I deserved to go shopping and get a new outfit.
I would also spend way too much money on bikinis and fake tanning.
The tanning was just because my friends were all still doing it. It is a habit I have since dropped as I really don’t want skin cancer or to look like I have leather skin at 35. I justified the bikinis because my parents live on a lake and I grew up swimming.
Looking back at the things I spent money on in college I could have saved a lot of money.
Do you know how many clothes I wore once or twice? Or some not even at all? Or that amount of money I spent on makeup that I was “going to experiment with” only to never touch?
Because let’s face it, I don’t know jack-diddle about makeup.
YOU DON’T HAVE TO EMPTY YOUR ACCOUNTS BETWEEN PAYCHECKS
There would be times where I would be walking around with less than $10 in my bank account waiting for the next payday. I would always survive, but usually, it meant eating total garbage food for a few days just to make that $10 or whatever it was stretch.
I just didn’t see the value in saving or investing any money at the time. Instead, I saw the amount of money in my bank account as spendable money until the next paycheck when I would get more.
My husband and I actually talk about this sometimes when we reflect on the “good ‘Ole college days”. You know, the days where you were broke as hell but tried to live like partying kings and queens. The days where you had less then $10 to your name but worked to support your partying habit.
YOU DON’T HAVE TO SPEND MONEY JUST BECAUSE OTHERS ARE
If you are out shopping with your friends you don’t have to purchase something every time they do.
I use to feel like if I was waiting in line with a friend for them to checkout that I should have something to purchase as well.
No. You don’t need anything. Put the random shit down and walk away.
Another example is when you go out to eat. If your friend wants to order five top-shelf cocktails let her, but you don’t need to.
That is unless you want to. Then you do you.
ONLY BUY THINGS YOU ACTUALLY LOVE
I can’t tell you how many things ended up in my closet that I kinda liked or thought that there would be something I could wear it with. Or even that there would be some occasion where having that would come in handy.
Do you know how many of those things are still unworn? Probably most of them.
Also, don’t buy something just because your friend likes it on you. If you don’t like it, don’t get it. You are going to be the one wearing it, not them.
Oh, and only get things that actually fit. I have several things that I bought that are just a little too small and I would always tell myself that I would keep working out and someday they would fit.
You know, that super unhealthy mind game we play. And surprise, surprise, it never happened. Those items just ended up taunting me in my closet because I was too stubborn to get rid of them.
LISTEN TO YOUR PARENTS
(Unless they suck at good money managment habits.)
Ok, I am sure my parents love seeing this section, and believe me that the 18-year-old Kait would be running away in disbelief and denial.
I used to hate talking about money and finances. I didn’t like feeling like I couldn’t do what I wanted with my money and that I had to be all adult-like and responsible.
Although now I really do wish I would have listened more to their ramblings about saving money and not spending it all like a nitwit. But, in true teenager fashion I didn’t and now they get to be all, “I told you so”.
Ouch.
The thing to think about, no matter how annoying it is, is that your parents have gone through all of this before. They have probably made some of the same mistakes they are trying to prevent you from making.
So for shit’s sake listen to them. Use then as a resource for how to create good money management habits.
Obviously, the caveat for this is if your parents are a total nightmare with money. Then definitely don’t listen to them unless they have drastically changed their ways.
BE COMFORTABLE SAYING “NO”
I can’t tell you how many times I did things in college, or even years after, that I didn’t really want to do but did anyway because all of my friends were. Like going shopping and feeling the pressure to purchase something I didn’t really want because my friends were all finding things they wanted.
Towards the end of college I had a group of friends where some of them couldn’t afford going out with everyone but still wanted to go. I would sometimes pick up the bill, but wasn’t comfortable putting a cap on my generosity.
You don’t want to be someone’s personal bank account. And you definitely don’t want to feel like your friend is taking advantage of you. Instead set clear limits. Maybe offer to buy them one drink instead of leaving the tab open all night for them.
CALM DOWN WITH THE CREDIT CARDS
Yes, credit cards can help your credit score and can be helpful in getting it up off the ground. But, that doesn’t mean you need to open every store card or credit card you are offered.
I had my first credit card in college. It was a Victoria’s Secret store credit card and, well, my closet quickly became filled with bikinis and bras.
I loved that I didn’t feel guilty for spending money on the credit card at the time. You know, since no one could see how much I was spending there except me.
Side note, yes, I still had my parents on my bank account. Which my mom checked often and would comment on my spending. This credit card though? It was like a dirty secret. Super appealing.
The down side? I went crazy. Like really crazy. I had a limit on that credit card that was way too high for the store. Like thousands over what you would ever need there.
That limit? Well I got close, very close over the years. And it didn’t help that I worked in a mall right next to a Victoria’s Secret. So every time I went on lunch I would walk past it.
OK, really I went in it. If we are going to be honest and all.
DON’T WAIT UNTIL AFTER COLLEGE TO HAVE GOOD MONEY MANAGEMENT HABITS
This was another silly thing I thought. I would always tell myself “I will get my shit together after college and be better about x”.
No, just no.
There’s no reason you can’t start having good money management habits while you are in college. It is actually a really good time to start trying to figure these things out.
Even if you are just putting aside $10 a month. Just start small and manageable and create good habits early.
GET STARTED
So there you have it, 9 money management tips I wish I knew in college. Take what you think will work for you and go for it.
Get your debt paid off. Set aside money for investments when the time is right for you. Spend money on things that will help you better yourself or make more money in the future (aka, invest in yourself).
Do whatever you feel is best for you to develop strong money management habits so you can live the life you want.
What are your favorite money management tips?