Finance Tips for 20 Somethings

    “Do I NEED this? Or do I just WANT it?” – For some of us, this question comes to mind every time we stand at a store counter or find ourselves on the phone with QVC dazed in the midnight blur of infomercials with deals that seem so good we just can’t pass them up. How we respond to that simple thought can have a powerful effect on our emotions and social life, as well as our finances. With that said, here are a few tips and things to consider next time you find yourself getting lured into another unnecessary purchase. 

That’s right, that Snickers bar is calling to you, and the store has that impulse aisle near the checkout for a reason. We’ve all been there before, walking in to pay for our gas because the card reader at the pump was broken yet again. We glanced over to the stand by the cashier and look at that “2 for the price of 1!” Not only that but that seductive thought slipped in again saying, “it’s just a candy bar it won’t break the bank, right?” Well, you’re right, one candy bar isn’t likely to put you in a bind come bill paying time, but that emotional pull that you feel when standing at checkout is one that advertising executives and salesmen have engineered just for you and I. Problems unfold when the purchase you’re being pulled toward is bigger and more expensive; and don’t get me wrong, those candy bars and drinks from the corner store can add up quickly as well, so what you ought to think about here is “the long run.”

“It’s time to get a new car… is it?” I recently bought a new car and found myself stumped as to where all my money had gone after writing out the following month’s budget. At the time I had a 2000 Mitsubishi with more miles on it than hairs on a dog’s back. The bottom line though, was that my steel on wheels was completely paid for. Car insurance on my clunker was remarkably cheap for a 20 something; however, at this point I had not only a few hundred coming out for a car note, but the insurance company wasn’t being very generous on my premium total either. I told myself that I needed a new car, but secretly I just couldn’t stand being seen in my old beat up ride much longer. You see now that the question at heart after all was… did I need a new car or did I just want one? 

Staying in the loop with the latest fads and keeping up with all of the top trending automotive and electronic gear can be a conversation starter and have a seemingly-beneficial effect on your social life, but can spending to stay relevant actually be a social self-destruct? As an adult, the bill is on you, not your parents, and the concept of “luxury versus necessity” sets in. Cars, food, and clothing at first thought are obvious necessities, but the question at hand can only be answered on a case by case, person to person basis. So start asking yourself simple questions like, “is it the right time to buy?”“I need a car to get to work, food so I don’t starve, and clothing”; but “do I need to upgrade my vehicle now, do I need to go out to eat tonight, and do I need to get those new shoes and sunglasses or will they go out of style in a week or two?”

 Making good decisions on how and when to spend your money doesn’t mean that you have to relinquish all of your social plug-ins and get togethers, but maintaining friendships by spending money is a more materialistic mindset than being a penny pincher with plans made for the future. Making good money-spending decisions is a truly rewarding life turn, permitting ever-so-often treats and nights out without the overhanging stress of how you will pay your bills. So next time you feel the urge to spend unnecessarily, ask yourself if you need to or just want to; because having enough money to make a purchase, doesn’t mean you can afford that purchase, in “the long run.”

Your Friend,,

J.R. Dalton