I remember graduating college and wondering, “Now what?”
Not only did I not know exactly what my career was going to be, I had very little understanding of managing my finances. Whether you are just starting out, building a business, or in the prime of your career, it is vital you understand how to properly take care of your money long term.
How much do you invest? And where? What about retirement?
Between watching two financially savvy girlfriends of mine invest their money and reading Suze Orman’s “Women and Money”, I began to understand how to make my money work for me. One of the first things I learned was how to manage my own finances. Don’t rely on anyone else to do this for you. My best friend’s mother said, “The most important thing you can do in life is to learn to take care of yourself. Don’t rely on others. And don’t expect others to take care of you. Learn to do it yourself and this includes your finances.” Women often make the mistake of relinquishing financial control to the men in their lives. Whether it is a partner or family member, they let go of the financial reigns. Sometimes they do this because they are old-fashioned or because they simply don’t want the responsibility. Later in life, these women are not in a good position to handle their own finances. Why? They didn’t learn about managing money at an early age and therefore don’t have the tools to do it in later life when they need it.
Another important financial goal is to focus on retirement even at an early age. Make a commitment to dedicate 10% of your income to retirement starting in your 20’s. Did you know that saving 10% of your income starting in your 20’s at a $50,000 a year salary could become $2.2 million dollars at retirement? Start building your nest egg early and it will pay off for you in the long run.
This may seem harsh, but don’t make emotional money mistakes. This can include a friend, loved one, or co-worker asking to borrow money from you. I can’t tell you how many times I’ve seen this happen to people I know and they always regret it. I’ve even made this mistake myself only to later regret it when I was never paid back. If someone can’t pay a debt off to a lender, what makes you think they can pay YOU back? Not only is this emotionally stressful, quite often it leads to the end of the friendship. It is difficult, but don’t loan out money unless you are OK with losing it for good.