The truth can be really hard to swallow, even harder when that truth is about the way you’re handling your money. After all, it’s your money and you can do whatever you want with it. But pause to think about this: Many people your age are doing better than you financially because they’ve somehow managed to accept the same ‘money truths’ you don’t want to hear and they’re using those truths to guide their spending. Maybe it’s time you listened and did something to change your negative money habits, for your own good.
Truth 1: You need an emergency fund.
No one ever prays to be in a difficult situation, but life isn’t predictable. Prepare for hard times with an emergency fund – a stash of money you never touch unless you don’t have an option. One way to do this is to put a small part of your income away in a bank account regularly and hope you have the willpower to keep your hands off the money.
That’s just stress.
A much easier way is to set up a fixed savings goal on ALAT. Set the goal to end in a year and name it ‘Do Not Touch’ just to remind yourself how important it is that you don’t cash out before you really, really need the money. The best part is, your money won’t just sit there idle – it’ll earn interest every day. Basically, you’ll be getting paid to keep an emergency fund. *gasp* How sweet is that?
This probably seems like a very grown-up thing to do and we all know how inconvenient grown-up things can be.
“Why can’t I just spend my money however I want today and not think too much about tomorrow?”
Sorry, you’re an adult now and you’re going to have to take responsibility for yourself. Start that fund now and we’ll be here to help you not spend it before you need to. That’s what friends do.