There are two things that I have come to realize even though I have heard them all my life. The first is that it is important to invest in yourself. The second was the unspoken rule to watch what you spend and not to spend frivolously.
Investing in Yourself
Over the last couple of years I have heard countless people talking about “investing in yourself”. They spoke of the need to be literate in your personal finances, to know what is going on in the markets, to watch the news, and just to be aware of the world around you. How easy is it to jack in the iPod on the way to work or school? You literally tune yourself out of the day’s events unfolding around you. We as a society have become cocooned in the lives that we want to be real. After I had come back from Europe, hardly any of my friends had heard of Russia invading into Georgia. I’ve gotten a bit off topic, but the fact remains that we don’t invest in our own education enough. Some of the best money that I have spent on myself involved purchasing books. Hands down the best financial book that I’ve ever read is “Rich Dad, Poor Dad”. Many people have heard of this book yet they fail to read it. There are no secrets about becoming rich in this book. Robert Kiyosaki advises his readers to pursue investments or to start their own business. He argues compellingly that you won’t get rich with your 9-5 unless you are at the top of the rung. Even then people are far from what he calls “financially free”. Basically financially free means that you are able have passive income (money that you don’t necessarily work for, but you are able to make) that will take care of you so that you don’t have to work. Many people dream of retiring at 40, or even sooner if they can manage it. His book should only be considered as a stepping stone in your financial journey. Don’t read it looking to get rich quick. Simply grow from his suggestions. Another book that has been amazing to my overall education was the “Wall Street Journal Complete Money and Investing Guidebook”. It’s a relatively small book, but it is incredibly informative about what types of investments are available and the different areas that you can explore. It’s a catch all for the “financial beginner”. Also, another great investment that I have made in my education is losing money in the stock market. How the heck was that good for my education? Several phrases come to mind: “No pain, no gain”, “What doesn’t kill you makes you stronger”, etc. Some of life’s best lessons come in the form of pain or loss. You grow from what you must learn from. An investment that I made went south. I now know and understand the risks of going opposite of the investing crowd. Don’t hesitate to buy a book or magazine subscription that you think will help you. Investing in yourself and your education will take you far in whatever you set out to do.
Pinching Pennies
This could be a bit touchy for some people. Words like “cheap” and “cheapskate” are ever present in our society. You don’t want to appear that you can’t or don’t want to partake in something. But there is a drastic difference between being cheap and being frugal. I have several instances of this. I was at the store the other day shopping for a few things to get settled back in for the new semester and I realized that I needed paper towels. I went to the paper section and began to compare the prices on the paper towels. After looking at the name brands I immediately compared them to the store brand. On average it was about $2 cheaper to go with the store brand. I ended up paying about $8.50 for 8 rolls of “extra long” paper towels. When I got home and placed them on the rack, I realized that I had just wasted $8.50. Why couldn’t I just find an actual hand towel to place in the kitchen? I’ve got some around the apartment and it could have lasted me all year. Needless to say I won’t be buying paper towels for at least another year. Now granted there are some things that you would want a paper towel for (cleaning up a mess on the floor or counter, but again a sponge will generally do the job). I’ll probably make them last for a year if possible. The second instance is going out to eat. I realized only this week how dumb it is to buy a drink when grabbing fast food. Usually when I go grab food I will be at my apartment first. So I should be able to bring some water along in a bottle. And I generally like to get the biggest size so that it will last me the longest. So on top of whatever food I get, I also get to tack on anywhere between $1-$2. Now that may not seem like a lot, but assume that I eat out everyday (I have set up a meal structure that allows me to do this). In a given week that will save me $7-$14 in drinks alone. A month would be $28-$56, a year would be $364-$728! That’s crazy for simply opting out on a drink. Even at nice sit down restaurants you can get water which is free. You might as well do this anyway because it is healthier for you.
Just a few things to consider and implement
