It’s official! You’re making money moves, right? You’re diligently putting in the effort, keeping your nose to the grindstone, and working tirelessly to secure those hard-earned banknotes. If you’re fully committed to this path, continuously pushing yourself to elevate your financial status, then bravo! However, if you haven’t yet embraced this mindset, don’t get too comfortable. We’re here to help you discover the steps needed to acquire those ‘expensive shoes.’

As you might have already gathered from the opening paragraph, we’re drawing inspiration from Cardi B’s lyrics in ‘Bodak Yellow’ to convey the unwavering dedication required day in and day out. If you truly desire something, you must be willing to invest the effort necessary to achieve it. Establish realistic goals and expectations for yourself, your business, and your relationships. Take your aspirations seriously. Whether that involves jotting them down and taking actionable steps, creating a vision board, or crafting a daily to-do list, commit to it wholeheartedly.”

How do you feel?

Do you experience a sense of relief? Are you comfortable with the choices you’ve made in your life? If the answer is no, then chances are you haven’t yet tasted the sweet freedom of financial stability. The worry of covering bills, putting food on the table, fretting over utility expenses, rent payments, or the looming threat of your car being towed away due to unpaid installments can cast a heavy shadow over your life. If these concerns weigh you down, it’s a sign that change is overdue.

Young Finance 101 is here to guide you toward a future where you no longer need to be haunted by unexpected bills or financial emergencies that trigger stress and anxiety. So, what needs to change? We’re determined to help you attain the financial freedom that empowers you to make the right decisions, even the daring choice of quitting your job. Imagine that freedom—it’s well within your reach.

Let’s rewind and learn from the past.

Once you’ve set your life’s goals and expectations, it’s time to reflect on the financial missteps you may have taken over the years. This exercise isn’t about dwelling on regrets but rather about learning valuable lessons from your past errors. Maybe you missed the chance to invest in your job’s 401K plan, purchased an unaffordable car, or took out student loans for a lavish lifestyle instead of educational necessities. We’ve all made financial misjudgments, but as the saying goes, ‘don’t count your chickens before they hatch.’ Recognizing that your current financial status doesn’t dictate your future is the first step. Some aspirations take time and patience. If you could turn back the clock, chances are you’d make different choices with the wisdom of hindsight. Remember, falling off a horse doesn’t mean giving up; it means mounting up again with a firmer grip.

It’s time to take charge of your money.

Master the art of wise money management. We’ve emphasized this before at Young Finance 101—budgeting is paramount. You need to be intimately aware of your financial inflow and outflow. Break down every expense, from bills to groceries, gas, utilities, entertainment, and miscellaneous spending. Assess whether you’re consistently in the red (with expenses surpassing income) each month, often leading to living paycheck-to-paycheck or, worse, relying on credit cards.

Before you can move forward, you must tidy up your financial house. Start by addressing the debts you’ve accumulated. Even if it means taking on a part-time job after your regular work hours or during weekends or exploring freelance opportunities to supplement your income, take action. The quicker you tackle your debts, the brighter your financial future becomes. Your future self will be immensely grateful.

Set your sights on savings.

Once you’ve defined your goals, expectations, budget, and established a secondary income source, it’s time to focus on savings. Shockingly, the median American household possesses a mere $11,700 in savings, according to a recent analysis by the Federal Reserve and Federal Deposit Insurance Corp. Savings are your safety net when life throws unexpected challenges your way—job loss, medical bills, car breakdowns, or injuries. A mere $1,000 in savings can be a lifesaver in tough times.

This leads us to the financial moves you should integrate into your life. It begins with setting up bill automation—simplify your life by arranging for automatic withdrawals for your accounts and bills. Most, if not all, bills such as car loans, credit cards, and student loans offer a due date option for automatic withdrawals from your checking or savings accounts. This ensures you never miss a payment, avoiding late fees and detrimental impacts on your credit. Extend this practice to your IRAs, savings, and money market accounts. Have your income automatically transferred to these accounts every payday, ensuring your financial stability while you focus on other life priorities.

Essential accounts you need.

While we’re on the topic of accounts and savings, consider maintaining seven key accounts to achieve financial success. Remember, it’s unwise to put all your financial eggs in one basket, as unforeseen issues can arise. Diversification is key. The must-have accounts include a 401K, IRA, high-interest money market account, checking (for bills), purpose-driven savings account, an emergency fund, and a brokerage account for investments. Configure these accounts to receive automatic transfers weekly or monthly, based on your budgeting insights. Determine how much to allocate to each account—this can be a percentage or fixed amount, which becomes clearer once you’ve covered your bills and basic expenses. Don’t forget: pay your bills first, allocate funds for food next, and save last, ensuring you understand your available disposable income.

Though we could continue to delve into more strategies for making smart money moves, Young Finance 101 will pause here to allow you to absorb this wealth of knowledge. If you’re hungry for more on this topic, leave a comment below, and we’ll be happy to provide further insights, or better yet, consider Part Two: ‘Making Money Moves in Your Sleep.’ Yes, it’s possible. Remember, here at Young Finance 101, the class is always in session.”

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