I am very career oriented and financially savvy individual and I like to believe everyone is the same. However, I am writing this post because, I was speaking to one of my friends and she is struggling with her finanances. I was trying to ask her more questions to see how she can save in order to pay for her bills.
She told me, she was struggling to pay off her credit cards, her brothers wedding was coming up so she bought some clothes. Then she said, she had bought a 8,000 dollars used car which looks really fancy and nice from outside, but turned out to be costly as it keeps breaking down. On top of that she has clinical anxiety for which, she can’t work full time. She also has school loans.
This is a vicious cycle! I am sharing this story that way you all avoid making this mistake. She doesn’t earn a lot with her part time job, she has to pay for gas, her car keeps breaking down, and she has a lot of loan. She says, she is not living her “best life”. When I asked her what does “best life” mean to her, her response was, “being financially free”. My follow up question was, what are you doing to resolve this? She said, she is trying to get a higher paying job.
But in the scenario above, what is one thing that she can eliminate in order to start saving right away? Did you say the broken car? Then great minds think alike!
A car is an expensive expense. You have to pay for gas, maintenance, and insurance. If you do not need a car, then don’t get one.
I went onto asking her about her retirement plans, she said, she doens’t think that far ahead. What about you all? Do you think that far ahead? Will you have enough money in your bank account by the time you are 60 to live off of it for the rest of your life when you cannot earn anymore?
If you didn’t plan that far then you definitely should plan your retirement. Here is a calculator that shows exactly how much you need to be putting away in order to save for your retirement:
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