If you have just landed your first job, you are about to embark into a world of financial freedom! No longer will you have to rely on your parents when you want money to go out to dinner, purchase concert tickets, or buy new shoes.
Having a job and earning money is great but with financial freedom comes with a lot of responsibility. Are you planning to go to college? Start saving now. Do you want to buy a car? If so, you need to keep your credit clear. Before you start spending the money you are making, it’s best to learn how to handle it well.
A credit card can be a very useful tool, but it can also be dangerous. Some kids get credit cards to use in emergencies, such as a car breakdown far from home. They can certainly be helpful—but you need to learn how expensive credit cards are if you use them for everyday purchases. These resources will help you comprehend the high cost of credit card use:
If you have a credit card, use it sparingly. Keep in mind, however, that you can, and probably should, use one to start building your credit score. If you are going to have a credit card, make sure you use it wisely..
Buying a Car
When the time comes to buy your first car, use some common sense. It may be fun to drive the hottest new sports car, but make sure the car you get can last for a couple of years, get good gas mileage, is affordable, and can safely take you to and from work or school. Buying gas, having repairs done, and making your monthly payments can all add up; you probably don’t want to spend your entire paycheck on your car. Save some money first, and either pay for your first car in cash or put a tremendous down payment on it. Try to avoid buying a brand-new car, because it will lose a lot of value the moment you drive it off the lot. For more information about buying a car, visit these links:
By using your money carefully and avoiding a debt trap, you can start saving for a large purchase or for your college expenses. Even as a teenager or young adult, you can and should start making good choices with your money.