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What would we teach our younger self about money matters?

Youth – it’s a time of excitement, adventure, experimentation and discovery. And some regrets! With the benefit of hindsight, what would we teach our younger self, especially about money matters? Live within your means. Plan for the future. Start today! Therefore, to the young and young-at-heart, take heed of these lessons so that with a little financial planning and management, you can prepare yourself for a fruitful future. Set yourself clear goals You know what makes budgeting and saving a whole lot easier? It’s defining your financial goals, both short-term (like saving for a new bicycle, or paying off your credit card balance!) and long-term (such as buying a house). Keep track of finances It’s important to not spend more than you earn. Devising a budget may sound limiting, but in actual fact it’s liberating. Simply put, it’s a plan for allocating your money. The secret to a sustainable budget is to make it as realistic as possible. Be wary of credit cards Use credit wisely. If you can’t avoid credit cards altogether, then be careful to not overuse them. Pay off the balance each month by the due date to take advantage of interest-free periods. This way, you reap the benefit of building a good credit rating, as well as avoid amassing debt and late payment fees. Save for an emergency Put aside a few dollars each week and build a buffer to live off should anything happen with your job or health. It’s good practice to increase the amount with each pay rise, too. Think beyond the here and now Respect your older self by building your nest egg. Yes, retirement seems so far away, but contributing to your superannuation can make a significant difference to your lifestyle in the future by setting a solid foundation. Thanks to compound interest (interest paid on both the original amount and on the interest it generates), the earlier you start saving the better. Ask questions… lots of them! An old Chinese proverb says “He who asks a question is a fool for five minutes; he who does not ask a question remains a fool forever.” Knowledge is fundamental to growth. If you don’t understand something, make enquiries – it’s a sign of strength, not weakness. Seek professional advice It may be the best money that you ever spend. A financial planner will help you manage your financial affairs and meet your life goals. They can give you confidence and peace of mind that your financial future is secure and on track. A professional financial adviser offering cashflow as a service can add a lot of value to their clients, providing advice in many areas including saving and household expense budgeting, cashflow, debt management, insurance and mortgages. They can also identify poor financial behaviour; educate and guide you to make better and smarter financial decisions; help you to set realistic goals; keep you on track; and act as a sounding board, ongoing.