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5 Financial Tips to Improve Your Independence

Ready to branch out and discover life on your own? The world is full of amazing experiences to explore. However, if you want to make the most of it, then you need to know how to manage your money. Cash really does make the world go around. Although it might not be able to buy you love or happiness, you’re going to need to make sure that you know how to use it if you want to avoid ending up in any tight spots.

Since personal finance hasn’t made its way into the high school curriculum yet, it’s up to you to track down the basics for yourself. To help you get started, here are some quick tips you’ll need to claim your independence.

1.     Practice Self Control

With a little luck, your parents will have taught you this school when you were a child. If not, the sooner you start practicing the art of delayed gratification, the better off you’ll be. Keeping your finances in order is much easier when you know how to say “no,” even to yourself. Although you might be able to buy anything you want on credit – that doesn’t mean you should.

Learning when to say no – even to the things you want most, is a great way to make sure that you’re prepared for anything in the years ahead. A good way to get started? Organize all of your money into envelopes so you can only ever spend the right amount on specific expenses.

2.     Consider Your Financial Future

Being independent isn’t all about fun and games or being the boss of yourself. If you want to take complete control of your life, then you need to consider your future. Failing to plan, is planning to fail, as they say. With that in mind, start thinking about your retirement and how much money you want to have in your pension by the time you retire.

Consider the kind of savings strategies that your employers offer, and what you can do to put the maximum contributions into your accounts each month. Though it’s tempting to blow any of the cash you have left over from your wages on fun and treats, you’ll thank yourself for being frugal in the long-term.

3.     Have an Emergency Fund

One of the best things you can do when you’re learning how to properly manage your money is make sure that you’re paying yourself first. This means that no matter how much you owe in credit card debt or student loans, you find at least some cash you can put aside into an emergency fund. Having money in a safety blanket that you can turn to when things go wrong really does help you to sleep better at night. What’s more, if you get into the habit of saving money, you’ll eventually end up with much more than just emergency cash.

Eventually, you can start to build on your emergency savings with additional money that you can use towards anything from vacations, to a deposit on your own house.

4.     Get to Grips with Taxes

One of the biggest downsides to being responsible for your own money is that you’re also responsible for your taxes too. You’ll need to make sure that you know how income taxes work before you start dividing your paycheck into a monthly budget. Additionally, knowing the basics of taxes will also help you to figure out how much you’re really getting when a business offers you a starting salary.

The good news is that there are plenty of tools out there that can simplify the process of calculating your own taxes, so all you need to do is log on and get searching. These calculators show you your exact income after taxes.

5.     Make Every Financial Decision Carefully

Finally, remember that sometimes the smallest financial choices can make a big difference in the long term. For instance, getting a loan with the first person to offer you cash might seem like a reasonable idea at first. However, later on, you may discover that you could have saved yourself a fortune on interest and fees if you’d simply shopped around for a while first.

Think each financial decision you need to make through carefully. If possible, it may even be a good idea to sleep on any decisions that account for more than $50 of your monthly income. The longer you take to make a decision, the less likely you are to “impulse” buy.

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