How can we live a life that is more prosperous? Some people manage to buy their own house and open their own business by the age of 30, while others are still trying to figure out their financial situation. To help you out with your financial situation here are some tips to bear in mind.
1. Children are expensive
Most people believe that we should have children in our early twenties or by the age of 30. But raising children is quite costly. For this reason, it's better to have kids when you are completely ready, and that includes your finances. It's also wise to prepare a 'financial cushion' with your partner before your family gets bigger.
2. It’s not embarrassing to ask for a promotion
If you've worked in the same position for more than 3 years, make your way up the career ladder by asking for a promotion. This is a good step to improve your financial situation. If you are refused a promotion several times, it's time to change your job, or improve your professional skills.
3. It’s more profitable to rent a house than buy it
While we like to think that investing in real estate is a good decision, mortgage rates are still high. To set the picture for you, imagine this scenario: Take a house that costs $100,000. It's rental is around $550 per month, making a yearly rental of $6,600. Subtract the $6,600 from the general cost of the house. Then put the remaining amount into a savings account with 7% interest. So, your yearly income with it will be $6,752, which will be more than enough to pay for another year of rental. Apart from that, you also won't need to spend money on maintenance, taxes and furniture. So, before making a decision whether to buy or not, consider all the expenses and choose a more profitable option.
4. Invest in your health and education
It's not easy to achieve success when you are not living healthily. It's therefore important to take care of yourself. Sleep well, go on a vacation at least once a year and eat well. Having a good education will also open a lot of doors helping you to climb your way up the career ladder.
5. Don’t invest in something you don’t know well
Prior to dealing with financial issues make sure you have a cold, sober and calm mind. Investing in dubious projects can cause you to lose a lot, if not all of your money. Prior to making an investment consult experts beforehand to have a sensible assessment of the project and its chances of becoming successful.
6. Don’t borrow to pay old debts
The concept of taking a new loan to repay an old one has become a popular trend. But repaying an old debt by borrowing from someone else will only lead to a vicious cycle. It is better not to be in debt at all. But if it happens that you have a loan, stop yourself from buying something and save the money to repay the loan without borrowing further.
7. Stay connected with your friends, and meet new people
It is said that 'a friend in court is better than a penny in the purse.' There is much truth to this. Sometimes, connections are more important than money.
8. It’s more efficient to buy shoes and clothes of good quality
As with many other things, clothes of good quality will serve you much longer than cheap clothes. It's therefore more effective to spend your money on durable things. To save you an extra penny, purchase good quality items during the sales and try to make a list of necessary items you need, waiting to buy them during this time.
9. Avoid impulsive purchases
While they do bring temporary joy, impulsive purchases can be problematic. Instead of buying another blouse, try to find joy in something else.
10. Eat and cook at home
While eating at cafés and restaurants is enjoyable, it's a lot cheaper to prepare your meals at home.
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