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What strategies can help me be financially stable early on?

I've noticed my parents always struggling with finances due to their spending habits and lack of financial understanding. I want to avoid this for myself at all costs and was wondering how I can implement good saving and financial habits early on to avoid falling into the same debt situation myself. I want to live without worrying about money but also have the ability to spend on wants occasionally. I will start college Fall of 2025 and I will be paying for college all alone with perhaps some financial aid from college because of cutting contact from my parents and not having parental support for separate reasons. However, I still want to make good financial decisions so I don't spend my life in crushing loans and debt. I have no knowledge of finances, cards or banking related stuff, so I would love to learn all there is to know.

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Isabel’s Answer

Dear Rashmitha,

To lay the foundation for financial stability at an early stage, begin with self-education on the subject of personal finance. Get to grips with budgeting—monitor your earnings and outgoings to manage your expenditure effectively. Initiate a savings account at a bank and utilize it to accumulate an emergency fund. Steer clear of unnecessary debt by comprehending interest rates and exercising caution when using credit cards. Look for resources on financial literacy on the internet or at your prospective college. Prepare for college costs by applying for scholarships and grants. Contemplate part-time employment or internships to acquire experience and boost your income. Establish financial objectives, give priority to savings, and revisit your budget occasionally to make necessary adjustments. Cultivating these good habits today will lay the groundwork for financial security in the future.
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Patty’s Answer

You are on the right track! Don't live above your means and pay cash. Start saving early and always think about your future and where you want your money to go. If you are planning on working while going through school think about the field you want to be in to get a jump start on experience, which could lead to higher pay and better opportunities. Once you start working contribute to a 401k.
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Donna’s Answer

If you are able to work during school, try to save half or what you make whenever possible. Do not get caught up in credit cards. You do not want to pay interest or minimum payments. Try to live with the concept that if you cannot afford to pay cash then is it absolutely necessary to purchase it. There may be times when a small investment may produce a greater good and it would be worth putting it on a credit card. However, depending on the purchase try to look for a similar item at a lower cost.
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Torin’s Answer

Hello Rashmitha,

Maintaining a sound financial life is crucial. A piece of advice that always resonates with me is, "It's not about the quantity of money you earn, but rather how you manage the money you have." Keeping a written budget is a practical way to keep track of your spending habits. Whenever you're about to make a purchase, no matter how small, it's wise to check your account balance first. This way, you're aware of exactly where your money is going. As your financial circumstances evolve, your budget should adapt accordingly.

The topic of credit is another significant aspect. Good credit can be a lifesaver in times of need, while bad credit can exacerbate an already challenging situation. I suggest that students consider getting a starter credit card to cultivate good credit habits from the start. Keep it straightforward - make one purchase with the credit card each month and ensure it's paid off in full. This practice will help you learn how to handle credit responsibly and avoid future issues. Whenever you borrow money, it's essential to have a repayment strategy in place.

When it comes to banking, many banks offer free accounts for students, so you shouldn't be incurring any banking fees. I would advise choosing a bank that provides excellent online or mobile banking services, as this can assist you in managing your budget effectively. It's also beneficial to have both a checking and savings account. Make it a habit to deposit a portion of each paycheck into your savings account to accumulate an emergency fund. Ideally, you should aim to have at least six months' worth of expenses saved as a safety net.
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Mario’s Answer

College is an expensive endeavor no matter how you look at it. If you are not receiving a full ride scholarship I would highly recommend you look at an in state community college for a few semesters to get in your base requirements then look at transferring into a larger school/university after 2 or so years. You can even work with a school you are already accepted to determine what classes from the community college will be able to transferred in and avoid losing any credits when doing so. On top of that working and establishing a budget or conscious spending plan is essential at all points in life. The earlier you start the sooner you will have success.
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Garrett’s Answer

Hello so first I lessen to Dave ramsey why is a business and personal finance expert but we'll running my business he said 1 thing to someone and it just clicked " do not make decisions based on your account but make decisions based on accounting " so make sure that you have a budget and are tracking your money so your are telling your money what to do instead of wandering where it went
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John’s Answer

It's commendable that you're already considering your financial future - this forward-thinking is a positive sign. As you prepare to embark on your college journey, it's crucial to carefully evaluate the institution you're attending and the total cost associated with it. College years can be immensely enjoyable, but it's also important to minimize your loan burden. Try to secure as many scholarships and grants as you can. If it doesn't interfere with your academic performance, you might also want to consider part-time employment.

After graduation, many individuals become preoccupied with projecting an image of wealth. However, if your aim is financial stability, it's essential to create and stick to a budget, with a strong emphasis on saving. A common pitfall for many is living beyond their means. True financial stability isn't about appearing wealthy, but about building actual wealth. This essentially means saving money and resisting the temptation to purchase the most expensive items within your reach.
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Sherry’s Answer

- Set a budget for what income is coming in vs. what you are spending every month
- Estalish a healthy credit history by paying your bills on time, avoiding credit card debt
- When you begin working, explore financial benefits with your employer and sign up for 401K, and other savings plans. The sooner the better.
- Follow the 50-20-30 rule. The 50-30-20 budget rule states that you should spend up to 50% of your after-tax income on needs and obligations that you must have or must do. The remaining half should dedicate 20% to savings, leaving 30% to be spent on things you want but don't necessarily need. The rule is a template that's intended to help individuals manage their money.
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Matthew’s Answer

There are great answers to this question regarding saving, budgeting, burn vs spend, etc. I want to give a few more specific strategies that might be helpful:

Matthew recommends the following next steps:

Treat your credit card like a debit card, and NEVER let it charge you interest. This will improve your credit score, earn rewards points/cashback, and provide an extra layer of security from hackers.
Learn to cook. Eating out is expensive (and often much less healthy), so save it for when you are with friends. Look for simple recipes and marinades, and invest in a decent spice portfolio and an air fryer. It won't take long before you like your own cooking better than the restaurant food anyway!
A college degree provides valuable income opportunities... sometimes. There are degrees with much lower returns on investment... if you've always dreamed of studying sociology or political science, be sure to pair that with a second major with higher earning potential. Starting in Community College and transferring to a 4-year public university dramatically reduces the cost of college as well. Where you go and what you study will have a huge impact on the financial value of college. And don't discount the value of trade schools!
Stay safe and healthy! Medical debt is crushing our population, driven by poor diets and sedentary lifestyles. You won't easily see the savings benefits of eating healthy and staying active but believe me, they are massive assets to your finances. Take care of yourself :)
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Pluralsight’s Answer

Live within your means don’t get into credit card debt. You can always have a side gig if you can if you’re entrepreneurial give it a go while you have low expenses and no dependents. Share expenses with roommates or family find financially, responsible, friends, and hobbies. Don’t compare yourself to others in this situation.
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Pluralsight’s Answer

Budget avoid established credit start contributing what you can to your 401(k) understand interest rates, understand and utilize your resources to make sure you don’t fall for the “get rich quick scheme”. Live within your means when using a credit card and ask for smaller rates every three months if you do have credit card debt.
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Pluralsight’s Answer

Learn more about compounding interest, and invest early and often. You can add more revenue streams. This can be challenging at first, but with this mindset, you will unlock financial freedom earlier than most a mentor can also be helpful. Invest in what you understand well.
Start by developing investment practices that’ are within the budget. Develop a rainy day fund. You never know what can happen when you will need it.
Hold yourself accountable to a budget revisit that budget and adjust as needed to ensure you are not consistently finding yourself going over budget.
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Pluralsight’s Answer

Limit spending
Invest and be educated on personal finance.
Find ways to build credit responsibly and talk to an employer about financial education and investment options.
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Pluralsight’s Answer

Make a systematic budget and make sure to put limits on your credit card
Instant gratification versus delay
Start by building, good habits for example try and save five dollars then even more
Invest so your money can grow
Make sure to assess what your needs are in terms of rent and food versus the things that you just want
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Pluralsight’s Answer

Spend less than you earned this allows you to save even a little
Plan for your one off expenditure how much will you spend on your summer holiday? Christmas gifting? use a budget either through self creation or an app
Spend a third or less on fix expenditure, housing, and bills to set yourself up for success. Don’t dig yourself into a hole by going crazy on rent.
Be creative on how you spend your money by less by secondhand use free resources
Stainer Lane don’t keep up with the others’ expenditures! Avoid “ blowing out” on payday.
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Pluralsight’s Answer

Discipline: saving a percentage consistently building habits to save
Automate saving in systems, for example, have a 401(k), a savings account, etc.
Create separate savings account from your main day today fund develop a budget and revisit as needed.
Build habits at a young age to compound money
Annual or quarterly budget review. You are your own CFO
Build an emergency fund. You can aim for 10 months of monthly expenses, evaluate health plans such as HSA, PPO and life insurance.
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