Confessions of a Poor Money Manager

Just starting out? Still in College? Starting your first job? Thinking and praying about getting married? Now is the best time to set yourself up for a lifetime of money success with some time-tested principles. The article, “Ten Financial Commandments For Twenty Somethings” by Erin Burt, Contributing Editor, Kiplinger.com, lists ten great tips for every twenty something. Erin Burt writes,

“When you’re in your twenties, change is a way of life. You’re choosing a career, paying your own bills, getting your own place to live and perhaps making decisions about marriage and family.”

Following are the 10 Financial Commandments:

1. Plan ahead. To get where you want to go in life, you need goals and a plan to reach them. Having neither is like driving a car without a steering wheel — with your eyes closed.

2. Live within your means. Can’t afford something? Don’t buy it. Sounds simple, but too many people have a heck of a time following this one and get in over their heads in debt.

3. Make saving a habit. Arrange with your bank to automatically divert part of your paycheck every month into a savings account.

4. Pay off your credit cards. Set a goal to pay off all credit-card debt before you turn 30 and have other financial responsibilities to tend to. A $2,000 balance at 18% interest would take nearly ten years to pay off if you made the minimum 4% payment each month and would cost you an extra $1,116 in interest.

5. Start investing. The sooner you start investing for retirement, the less painful it will be and the more money you’ll accumulate.

6. Establish credit. In order to qualify for the best interest rates on a credit card, auto loan or mortgage, you need to start building a solid credit history.

7. Have a marketable skill. “Your own earning power — rooted in your education and job skills — is the most valuable asset you’ll ever own,” says Knight Kiplinger, editor in chief of Kiplinger.com. Your twenties is the time to invest in yourself to acquire those skills that will start your career and boost your earnings.

8. Cut the financial umbilical cord. You have your own apartment and your own paycheck. You may even have your own spouse and children. Isn’t it time you grew up? If Mom and Dad are still preparing your taxes, balancing your checkbook or managing your investments, consider this: Whoever controls your finances controls your life.

9. Marry wisely. You and your spouse create the most important team in your life. You’ll want to make sure your team works well — and shares similar financial values — so you can work together toward common goals. Money can drive a wedge between even the strongest of couples.

10. Have some fun. Personal finance doesn’t have to be boring.

I recommend the 10 Tips as Erin Burt has suggested. I would add, Be Generous in Giving, after all, it all belongs to God! Clearly, what we do with money is a test of our faith!

Ashley Clayton, money management expert, providing support and guidance to pastor’s financial management ministry to their congregations.