It may come as a shock to some but big ticket items are not usually the reason young working adults miss the target when it comes to financial goals. Cars, televisions, and stereos seem to be the obvious culprits, and they can be troublesome areas when it comes to over-spending, but here’s a financial literacy tidbit to ponder.
Pay attention to the small stuff. That’s what eating your budget alive.
We’re talking about the daily morning stop at Starbucks, the Big Gulp caffeine buzz soft drink at lunch that gets you through the afternoon – and exactly how much are you spending on your cell phone bill every month? Is it absolutely necessary to be that much in touch? The reason expenses like this are so insidious is that they are such a part of your routine you don’t notice them. Probably don’t even think about them or take the time to add up how much it costs to grab a fancy morning coffee every working day of your life.
This is where so much of the financial literacy training you get in school falls woefully short. Intro to Business 101 loves to talk about the big business cycles that make the economies of the world go around but never bothers to show you where your budget is bleeding out. All the investment advice in the world won’t do you a bit of good if you have no funds to do it with.
In the beginning of your working life, it’s hard to find money to save. You owe it to yourself and to your future to stop wasting what you do earn or at least be aware of exactly where every dollar goes each month. Maybe a morning latte is more important than future financial security. If that’s your decision, so be it but make the call from a position of financial literacy and realize the price you’re paying.
The Young Wealth Team
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