| "Streams run into rivers and rivers into seas". The | | | | Ultimately, your health is your responsibility. |
| mistakes that we make in our youth can remain | | | | 3) Failing to separate needs and wants |
| with us many years later. Financial mistakes that | | | | The basic concept behind wealth accumulation is |
| young adults make are no different Young adults | | | | to spend less than you earn. However, most |
| would normally have just started earning an | | | | young adults get caught up with the "buy now, |
| income. The inexperience and novelty of the | | | | pay later" concept. Distinguishing between needs |
| increase in economic power causes many young | | | | and wants helps you to prioritise and make |
| adults to make serious financial mistakes. | | | | necessary sacrifices to achieve your goals. Inability |
| 1) Not developing a proper financial plan | | | | to do this leads to other mistakes like taking loans |
| For many reasons, young adults may neglect or | | | | for non-necessities and focusing on acquiring |
| be unable to develop a sound financial base. The | | | | assets that would not increase your net worth. |
| reasons could range from poor financial attitudes | | | | 4) Late bill payments |
| to myriad competing needs (education, | | | | Not paying your bills on time can negatively affect |
| accommodation and living expenses). Insufficient | | | | your credit rating. When you're young, your |
| attention to financial planning is a broad category | | | | financial presence and history is only just being |
| that encompasses a range of failures:a) Failing to | | | | established. If you take this lightly and miss a few |
| set financial goalsb) Winging it and failing to | | | | payments or habitually make late payments, this |
| budgetc) Not saving for the future (retirement | | | | mistake could affect you when you apply for |
| and medium-term goals particularly)d) Inadequate | | | | mortgages and other necessary loans later. |
| health, medical or life insurancee) Low or | | | | 5) Not paying sufficient attention to expenses, |
| non-existent emergency funds | | | | transaction fees and charges. |
| 2) Using credit cards irresponsibly | | | | Young adults today are less likely to be penny |
| It is not inherently useful advice to suggest that | | | | pinchers than those of yesteryear. However, the |
| people should avoid credit cards altogether. Credit | | | | bank fees and charges and unnecessary |
| cards have few benefits. Like water or fire, credit | | | | expenses all add up. Having more credit cards or |
| cards are a great servant but destructive master. | | | | overusing debit cards where fees are incurred |
| Incurring a large credit card debt and only being | | | | would just mean higher costs with no value being |
| able to make minimum payments are signs of | | | | added to your financial portfolio. |
| poor credit card management. | | | | The most serious financial mistakes that young |
| It suggests that you would be buying on impulse | | | | adults make are those that affect them in the |
| and not monitoring/ resolving your accumulating | | | | long-term. These mistakes can cripple or handicap |
| debt. Having champagne taste and a Kool Aid | | | | young adults' financial planning and leave them with |
| pocket is your problem. The credit card | | | | many regrets. Fortunately, people can recover |
| companies may wish for you to do certain things | | | | from mistakes, although this can be really difficult. |
| that are in their best interest and not yours. | | | | Prevention is better than cure. |