Valuable Financial Advice from a Young Age: Keys to Long-Term Success

When we're young, the financial advice we receive can shape our adult lives. From a simple lesson on living within our means to the wisdom of making more money rather than saving it, these bits of advice can be the foundation for a financially sound future. In this article, we will explore several pieces of financial guidance that have stood the test of time and the role they play in achieving long-term financial success.

Live Within Your Means

One of the timeless pieces of financial advice that many of us receive at a young age is to live within our means. This advice is particularly pertinent in today's age of social media and constant consumerism. Social platforms and apps can often nudge us towards overspending in an effort to fit in or impress others. However, the key to financial happiness and stability is to live a life where your spending matches your earnings and you are comfortable with your choices. As someone who learned to make ends meet early, I can attest to the importance of this advice.

Create a Budget and Stick to It

One of the cornerstones of financial wisdom is having a budget. This advice is often undervalued, but its importance cannot be overstated. A budget is a practical plan for your money, helping you track your expenses and manage your finances effectively. There are numerous tools available to assist you, such as Habit Money. By creating a budget, you can better understand where your money goes and make informed decisions about spending.

Make More Money, Not Just Save It

Another crucial piece of advice is to not just save your money but to actively seek ways to make more. Saving is important, but money should be a tool to build wealth, not just a means of financial security. By focusing on ways to increase your income, you can achieve financial goals faster. This could be through investing, building a side business, or seeking out higher-paying job opportunities. For instance, I learned early on that increasing your income is more valuable than merely saving money.

Turn a Profit

A simple yet effective piece of advice is to "buy low and sell high." This principle, often summarized as "buy for one, sell for two," offers a great way to increase your income, even as a child. One example from my own experience in the 1980s involved selling candy mold gypsum figures to my neighbors. As a 5-6-year-old, I would buy the figures at a low price and sell them for a slightly higher price, thus increasing my weekly allowance. This experience, while small, taught me the value of turning a profit and the importance of creating value through small actions.

Save Wisely

Another key piece of advice is to save your money wisely. During my childhood, I saved my allowance to buy presents for my family. By the time I was in my teens, I had accumulated a respectable amount of savings, which I later used to make significant improvements to my home. While it is important to save, it is equally important to ensure that your savings are being used for future benefits. For example, my home improvements, which amounted to over 40,000 dollars, were necessary due to damages from Oregon winds and constant rain. Additionally, your savings should not be hoarded entirely; in your 30s and 40s, it's crucial to enjoy life and travel. Being generous with your means can also help in giving back to frugal parents.

Capitalize on Opportunities

Reading and learning on your own can reveal valuable financial insights. For instance, credit card churning can be a beneficial strategy if you can resist the temptation to overspend. When making purchases, consider if there is a way to earn back some of the cost or even break even. Additionally, developing the right skills can lead to significant income gains. Adversity should not be a deterrent; instead, it should be an opportunity for growth. When faced with challenges, as I was at 17, I worked hard to graduate early and pursue my career ambitions. This experience taught me that perseverance and the pursuit of relevant skills can lead to better financial outcomes.