You’ve moved into your new flat, you’ve spruced up the place and went on a discovery trip to find the best lunch spots in your area. Your new work wardrobe is #goals and you’ve already set the date for that amazing rooftop party happening at the weekend.
But before you go out for brunch the third time this week, stop and think about your finances, the bad habits you’ve developed throughout your younger and university life and how they affect your newly-found independence.
- Look back at mum and dad
There is such a thing called Money DNA and it affects the way in which you see money. The concept is based on the idea that the way your parents treated their finances and how they exposed you to said finances has shaped how you see money and your own financial situation. Looking deeper into this can shed light on some of the money-spending habits and view of finances you have right now. If you’d like to go into more detail, you can check out this link.
- Do you keep track of your spending?
Yes, spreadsheets are boring, we can all agree on that – try picking a cute planner or use an app. The reason behind this is that if you have a written down version of your spending, you will see what your expenses and whims are and plan accordingly. It will also make you think back on your purchases and examine the real reasons you decided to drop money on them.
- How well are you with plans? Yes, a budget is a plan
If you ask any financial guru out there for advice, they will most definitely begin with a budget. Sitting down at the beginning of the month or whenever you get your wage/paycheck/salary and making a plan on how your money is going to pan out until your next salary is the best way to get to grips with your finances. Make a compulsory category, which should include any recurrent payments such as rent, insurance, travelcards, bills and monthly services (yes, Netflix), and a not so compulsory category, which includes eating out, travelling and shopping. In addition to this, you should consider a savings category – be it for your far-away retirement or for the Greece trip you’re taking next year with your friends.
- But do you do your research?
When I first moved into my London flat, there was no Wifi and I had to cosy up to the neighbours so I can leech off of their connection. I barely researched what offers were on and quickly emailed the first service provider I could think of to set an installation date. With a signed contract and a super fast connection, I quickly learned that there were at least 2 more providers who offered the same internet speed for little under 3/4 of the price I was paying.
- Tell me how you shop online and I’ll tell you what kind of person you are
We’re all guilty of overspending online, especially since it comes with free shipping and a whopping 20% off, right? Well, if you feel like too much of your cash is going onto the digital realm, try this: unsubscribe from some of the newsletter you’ve signed up for so you don’t get pesky e-mails with offers “too good to pass”. This way, not only will you save that fiver you were about to spend on that top you would’ve most probably never worn, but it will also save you precious time that would’ve otherwise have been spent browsing velvet bell sleeve bodycon dresses.
- Debit is #Bae
If you don’t already have a strong finance game, maybe you should keep off the credit-card rollercoaster and opt to use only debit and cash. While creating a good credit score is a great financial goal to have, the pressures of living in a new flat and making new friends can push you into spending your overdraft and debt can easily snowball and put you in a bad financial situation in the long run.
- You’re not a quitter… but maybe you should quit Starbucks
It looks nice in your hand, it Instagram nicely, it wakes you up – handmade coffee is the absolute best, especially when you find your #truelove barista who foams that soy milk to perfection. But dropping £3 every morning to get your caffeine fix quickly adds up and you can see yourself spending £60/month = and that a whopping £800 for coffee/year. While we don’t encourage completely dropping it, maybe keep it as an indulgence over the weekend and start brewing your own.
- You are too poor to afford cheap stuff
When shopping, a bargain is a bargain, but sometimes you can fall into the frenzy of spending as little as possible and make decisions that can affect you in the long term. Think this way – if you buy a £20 jacket every year, you spend £100 over the course of 5 years (not to mention the ethical implications of said jacket), while if you spend £100 on a jacket that you will keep for 10 years, you are better off because you are wearing a better quality item. (Did we mention it’s also great for the environment?!)
- Have a fuck off fund
The first time I managed to save a good chunk of money, I felt so empowered and it gave me more financial confidence – to risk a little bit more or to just have safety of mind that I had a financial cushion to fall on. Having a safety net for money emergencies can be even life-saving since in so many cases money is the reason why people stay with abusive spouses or in abusive jobs. This article is a great read on why you should have a fuck off fund.