6 Financial Tips to Stay Debt-Free for Life
Sarah, the daughter of a Senomyx Finance Dept. employee, keeps track of her money.
Senomyx is a public company traded on the NASDAQ stock exchange, and one of our employees has spent time going to local schools to teach children about finances and the stock markets. In these times of cashless transactions and the ease of debit and credit purchases, we think it’s worthwhile to give children some financial tips to help create life-long habits of good money management. Here are some of our favorite tips, adapted from Investopedia, that you can introduce in your household.
1. Learn Self Control
You can purchase an item on credit the minute you want it, but it’s better to wait until you’ve actually saved up the money. Do you really want to pay interest on a new cell phone? Do you want to deplete that debit card?
2. Take Control of Your Own Financial Future
Research, research, research! Learn about money management by reading a few basic books on personal finance. Before getting a new card, research credit and debit card fees. Understanding how money works is the first step toward making your money work for you.
3. Know Where Your Money Goes
Ensure your expenses aren’t exceeding your income. The best way to do this is by budgeting. Once you see how your morning java or your children’s excess toys add up over the course of a month, you’ll realize that making small, manageable changes in your everyday expenses can have a real impact on your financial situation.
4. Start an Emergency Fund
One of personal finance’s oft-repeated mantras is “pay yourself first.” It’s wise to find some amount – any amount – of money in your budget to save every month in an emergency fund. Don’t just sock away this money under your mattress; put it in a savings account, a certificate of deposit, or a money market account. Otherwise, inflation can erode the value of your savings.
5. Start Saving for Retirement Now
Prepare for your retirement well in advance – because of the way compound interest works, the sooner you start saving, the better, even if you’re just taking some “baby steps” toward building a retirement fund. Food for thought…look into company-sponsored retirement plans that can enhance your savings. Some corporate plans match part of your contribution, which is like getting free money.
6. Guard Your Health
Maintain a healthy lifestyle by watching your weight, exercising, not smoking, and not consuming alcohol in excess. Protect your heart, lungs, and other organs – overeating alone can lead to high blood pressure, diabetes, and kidney disease. Taking care of yourself is good for your body and your wallet!
Remember, you don’t need any fancy degrees, godly powers, or expensive tech devices to become smart at managing your finances. You don’t have to make major lifestyle changes, either, just follow some of these tips to “taste the good life” without paying too much for it!