“Recently I went into a store just to browse. I came out with an expensive item that I had no intention of buying when I walked in!”—Colin.
Colin admits that he has trouble controlling his spending. Do you have a similar problem? If so, this article can help you.
Why control your spending?
Myth: Being concerned about your spending habits will restrict your freedom.
Fact: Controlling your spending will give you more freedom, not less. “The more you know about money, the more of it you’ll have for the things you want—now and in the future,” says the book I’m Broke! The Money Handbook.
Consider: By controlling your spending . . .
You will have more money when you need it. “I would love to travel to South America at some time in the future,” says a teenager named Inez. “When I put money aside, I try to keep that goal in mind.”
You will have less (or even zero) debt. The Bible says: “The borrower is a slave to the lender.” (Proverbs 22:7) A young woman named Anna would agree. “Debt can take over your life,” she says. “Being debt free allows you to focus on your goals.”
You show yourself to be mature. People who control their spending are better prepared for adulthood. “It’s good training for the future, when I will live on my own,” says 20-year-old Jean. “I’m trying to be responsible with money now, so that I’ll be that way later.”
The bottom line: “Managing money on your own is an excellent first step toward becoming independent,” says the book The Complete Guide to Personal Finance: For Teenagers and College Students. “Effectively handling your money is a talent that will serve you well for the rest of your life.”
How to do it
Know your weaknesses. If you’re constantly running out of cash, first find out where your money is going. For some, online shopping is the culprit. For others, the problem is a slow financial ‘leak’ that drains their wallet by the end of the month!
“Small everyday expenses add up. A little gift here and there, a coffee stop, an extra item on sale at the grocery store—after a month of that, I’m wondering where a hundred dollars went!”—Hailey.
Create a budget. The Bible says: “The plans of the diligent surely lead to success.” (Proverbs 21:5) By creating a budget, you can make sure that your expenses are not greater than your income.
“If you spend more than you earn, determine where your money is going and eliminate the things you don’t need. Shrink the list of expenses until you are earning more than you are spending.”—Danielle.
Follow through. There are a number of ways you can keep track of your money and avoid needless spending. Some young people have found the following methods to be successful:
“Usually, I put my money straight into the bank because I know I’ll be less tempted to spend it if it’s there.”—David.
“When I go to the store, I bring a reasonable amount of money. That way, I can’t spend more than I intended to.”—Ellen.
“The longer I wait before buying something, the more realistically I consider whether or not I need it.”—Jesiah.
“I don’t have to go to every social event! It’s OK to say no if I just don’t have the means.”—Jennifer.
The bottom line: Managing money is a serious responsibility. That’s what Colin, quoted at the outset, has started to realize. “If I’m going to be the head of a household someday, I can’t be squandering money!” he says. “If I’m doing a poor job with money now as a single person, it doesn’t bode well for married life.”
Tip: “Tell someone about your budget plan, and ask that person to check in with you every so often. Accountability is a good thing!”—Vanessa.