Let us talk money babes!
I have been doing a lot of reading on the topic of finance, which inspired me to write this post. Today I will be sharing with you some of my rules when it comes to managing my money.
These are my rules:
Live within your means
Do not try to keep up with society, and all the crazy trends. Do and buy what makes you genuinely happy. At the end of the day, you are the one who will have to live with the consequences of your bad spending habits. So be grateful for what you have and know how to differentiate your needs from your wants. Once you start living within your means you will realize that things will become easier because you will be able to spend your money where it really matters.
Learn to differentiate your needs from wants
We all want so many things and sometimes (most of the time) we do not even need them. This is why whenever I am thinking of buying something, I always ask myself the question of do I need it or do I want it? If I see something online, I usually put it in my shopping cart and do not buy it right away. If I do not go back to that item, that means I really didn’t need it.
And of course, do not deprive yourself of getting things that you want. Just make sure that you prioritize.
Not all credit cards are created it equal
This is so important. Whenever I use my credit card, which I pretty much use for everything; I make sure that I have enough money in the bank to pay for what I bought. If I do not have enough money, I do not use it. Unless of course is an emergency. In addition, I make sure that I inform myself on the type of credit cards that are available to me. Learn about late and annual fees as well as whether or not you can make money from it. What I mean by this… is get a credit card that you can get money or miles everything you use it. This is how I will be paying for my next trip.
Spend on things that will have a return on investment
If it is expensive, it had better be worth it. Education is a great example of this… if you are going to spend thousands of dollars make sure that you are able to benefit from it. Same goes for when you are buying anything else. I believe in quality vs. quantity. Spend money on things that you know will last.
Have a savings account
Having a savings account is a must. You never know what can happen. Even if all you can put is a $1 from each paycheck. Something is better than nothing.
I recently came across the “healthy spending” theory by Manisha Thakor. She believes that your income should be divided as follow; 50% should go towards things that you need such as bills, food etc. 30% should go towards your wants like buying something that makes you happy, traveling, etc… and that you should be saving 20% of your earnings. I thought this was a very unique way to manage your money. How do you save money?
What are your rules?
I will leave you with one of my favorite quotes from the #GirlBoss book by Sophia Amoruso.