There’s no way to avoid big expenses –– especially during your salad days. Paying for real estate, vehicles, vacations, furniture, moving costs, and school debts are all common, yet pricey aspects to life before you turn 40. However, some of the smartest people around manage to save money in their youth, and limit their need to pinch pennies later in life. Indeed, even identifying a few money-saving methods now can drastically improve your financial standing down the line. Here then are four savvy ways to reduce costs, budget better, and hang onto your cash before you hit middle age:
Play the Waiting Game
People make silly, stupid impulse purchases all the time. What’s more, it’s never been easier to buy things you don’t need thanks to internet/retail moguls like Amazon. The next time you feel tempted to buy another pair of running shoes or a sci-fi movie poster –– hit the brakes. Set yourself a calendar reminder for a week in advance and if you still want to make that purchase at the later date, then go for it. Odds are though, after a few days you’ll lose interest in buying something that doesn’t actually serve a purpose.
At the end of the day, any purchase you make should have a practical function first and foremost. Cars should run smoothly, jackets should keep you warm, food should taste good, and so on. When buying everyday items always look for the most practical solution to a problem and avoid flashier, more expensive alternatives.
Invest & Accumulate
Living from paycheck-to-paycheck may seem like a feasible strategy in your 20s or 30s. However, without a more stable financial base you could find yourself in dire straits if you lose your job or decide to start a family, for instance. As such, it’s wise for young people to set aside some capital each month to either invest in a conversative stock option, or to place in a bank account. No, it’s not the most exciting thing you can do with your expendable income, but the extra funds could come in handy on a rainy day.
Plan for the Long-Haul
If you’re lucky, one day you’ll reach old age. The sooner you recognize the expenses associated with retirement, the more motivated you’ll be to set aside money for the future. Remember, it’s never too early to review a last will and testament form, or to learn about your social-security options. Having a long-term plan in mind will help you budget more effectively form year-to-year, and let you know when you can afford to splurge and when you should keep the powder dry.