{"id":3307,"date":"2019-06-08T17:51:04","date_gmt":"2019-06-08T13:51:04","guid":{"rendered":"https:\/\/blog.cudoo.com\/?p=3307"},"modified":"2020-07-02T21:12:28","modified_gmt":"2020-07-02T17:12:28","slug":"money-struggles-every-20-something-should-go-through-and-why","status":"publish","type":"post","link":"https:\/\/cudoo.com\/blog\/money-struggles-every-20-something-should-go-through-and-why\/","title":{"rendered":"Money Struggles Every 20-Something Should Go Through and Why"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Being young and broke is a rite of passage that nearly everybody goes through in their early adulthood. And, although it isn\u2019t pleasant, it is highly instructive and can shape you into a more frugal, more savvy, and even more compassionate person \u2014 which will be helpful for yourself and those around you, for the rest of your life. (Plus, often the payoff is the incomparable satisfaction of being able to pay your own rent and bills like a grown-up.) <a href=\"https:\/\/cudoo.com\/products\/accounting-finance\/managing-personal-finances\/\" target=\"_blank\" rel=\"noopener\">Learning how to navigate money struggles<\/a> can teach you plenty of useful lessons like the ones below.<\/span><!--more--><\/p>\n<h2><b>Don&#8217;t pay too much for rent<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Paying too much for rent is a mistake many adults make, not realizing it\u2019s one of the top reasons why people stay broke. There are plenty of ways to scale back and pay less for rent. You\u2019ll learn this through trial and error over time, but here are some tips to get you started.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><b>Find a roommate:<\/b><span style=\"font-weight: 400;\">\u00a0It only makes sense to share your rental costs with other people while you\u2019re still young, single, and adaptable. The internet can be your friend when it comes to<\/span> <span style=\"font-weight: 400;\">finding compatible roommates<\/span><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\"><b>Move to a cheaper city:<\/b><span style=\"font-weight: 400;\">\u00a0If you\u2019re paying too much in rent, consider someplace new! <\/span><span style=\"font-weight: 400;\">Kansas City<\/span><span style=\"font-weight: 400;\">, for example, has one of the lowest costs of living and the\u00a0<\/span><a href=\"https:\/\/www.kansascity.com\/news\/politics-government\/article56498968.html\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">shortest commuting times<\/span><\/a><span style=\"font-weight: 400;\"> in the country. And exploring a new culture outside of the one you\u2019ve grown up in is exciting and full of learning opportunities.<\/span><\/li>\n<li style=\"font-weight: 400;\"><b>Negotiate your lease:<\/b><span style=\"font-weight: 400;\">\u00a0If you\u2019re happy where you are, ask your landlord if they\u2019ll cut you a break if you sign a two-year lease instead of an annual renewal. Less annual turnover saves them money, so they like to lock people in. They may be willing to pass some of the savings to you.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Rent is one of the biggest expenses you\u2019ll face throughout your life. Try to spend no more than 30% of your income on it (including utilities) so you don\u2019t struggle more than you need to.<\/span><\/p>\n<h2><b>Know cars ARE NOT a good investment<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Cars aren\u2019t cheap, especially when you factor in insurance, maintenance, repairs, and gas on top of the purchase price. And a car is simply a means to an end. It gets you where you need to go, but it\u2019s certainly not the only option for doing so.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">While it might be tempting to take your first few \u201creal\u201d paychecks and buy a car based on its features, appearance, and other costly options \u2014 stop yourself. Go for practicality and usefulness. Most importantly, don\u2019t spend more than you can afford on a car. Be smart; budget for only what you need and save your money.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Remember, autos<\/span> <span style=\"font-weight: 400;\">depreciate quickly<\/span><span style=\"font-weight: 400;\"> and, over time, heavily lose their value. Don\u2019t waste your time or cash on an expensive car while you\u2019re in your 20s. There will always be time for this later in life after you&#8217;re financially stable if it\u2019s something you still want.<\/span><\/p>\n<h2><b>Understand property IS a good investment for your money<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Unlike cars, real estate property typically increases in value over time. As a property owner, you could build equity and stabilize your future because you purchased assets that become worth more down the road.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But be sure to go into property ownership with your eyes wide open. Understand the terms and implications of principal, interest, interest rates, real estate taxes, and home insurance. And don\u2019t buy more house than you need, unless you\u2019re <\/span><span style=\"font-weight: 400;\">investing in a rental property<\/span><span style=\"font-weight: 400;\">. (This is an exception because you\u2019d be actively making money on your investment rather than living in excess space you don\u2019t need.)<\/span><\/p>\n<h2><b>Read the fine print<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Seriously, read the fine print. Always! Most people are used to carelessly clicking through<\/span><a href=\"https:\/\/www.techopedia.com\/definition\/4243\/clickwrap-agreement\" target=\"_blank\" rel=\"noopener\"> <span style=\"font-weight: 400;\">clickwrap agreements<\/span><\/a><span style=\"font-weight: 400;\"> so they can quickly move on. But when it comes to money matters, always read the details before clicking \u201cI accept,\u201d \u201cOK,\u201d or \u201cI agree\u201d \u2014 and definitely before signing your name to anything. Never rush through. You never know what kind of trap you could be walking into \u2014 and how much money it could ultimately cost you \u2014 unless you read the terms of an agreement carefully.<\/span><\/p>\n<h2><b>Learn how to pay taxes<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">In earlier decades, our parents and grandparents had to do their taxes using paper, pen, and handheld calculator, along with flipping through convoluted tax booklets to figure out how to pay Uncle Sam every year. We have it so much easier. The hardest challenge taxpayers today face is remembering this important responsibility and making sure taxes are filed on time \u2014 it\u2019s important to avoid incurring penalties and interest charges.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">We\u2019re even lucky enough to have online tax calculators we can use to determine if we\u2019re having the<\/span> <span style=\"font-weight: 400;\">right amount of taxes deducted<\/span><span style=\"font-weight: 400;\"> from our paychecks. If not, with a quick recalculation, we can learn what adjustments need to be made. Try to have as much deducted as you can stand; it\u2019s a lot better to get a refund than a bill than have to pay every spring. <\/span><\/p>\n<h2><b>Don\u2019t relax during economic booms<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Currently, the American unemployment rate is at the<\/span><a href=\"https:\/\/www.npr.org\/2018\/10\/05\/654417887\/u-s-unemployment-rate-drops-to-3-7-percent-lowest-in-nearly-50-years\" target=\"_blank\" rel=\"noopener\"> <span style=\"font-weight: 400;\">lowest it\u2019s been since 1969<\/span><\/a><span style=\"font-weight: 400;\">. While it\u2019s great for us now as we start our careers because we have lots of options, older generations know from experience that the bottom could drop at any time. Don\u2019t relax during good times. The recent recession was a perfect example of that.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Losing a job early in your career feels awful. However, it&#8217;s also an important \u2014 and powerful \u2014 reminder that it\u2019s always a smart financial strategy to continuously plan and save for the future. Don&#8217;t assume that paychecks will always be there. Live beneath your means. Seriously. At some point, unemployment rates will rise again and you might find yourself struggling to find a new position.<\/span><\/p>\n<h2><b>Know the difference between wants and needs<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Our generation loves its Starbucks and Paneras, but these extras get expensive. Being broke makes one realize how ridiculous it is to spend $6 on a latte and eat out all the time. We\u2019re so used to swiping our debit cards we don\u2019t realize that one $6 latte a day adds up to about $180 a month.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Think about the other things you can do with that amount of cash! We\u2019re talking about paying major bills with that money. Consider <\/span><a href=\"https:\/\/www.businessinsider.com\/lifestyle-changes-to-save-more-money-2015-11#stop-buying-a-daily-coffee-6\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">all the ways you spend cash that you don\u2019t have to<\/span><\/a><span style=\"font-weight: 400;\"> \u2014 and then start making your own coffee, learning to cook (explore global cuisines!), and, ultimately, saving money daily.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Being broke is no fun, but it\u2019s common in your 20s. And it\u2019s a great way to get motivated and learn how not to be cash-strapped down the road. Having to count every penny makes you realize all the ways money can just slip through your fingers if you get complacent and lazy. However, by keeping careful track of how your money flows, you&#8217;ll <a href=\"https:\/\/cudoo.com\/products\/accounting-finance\/budgets-and-managing-money\/\" target=\"_blank\" rel=\"noopener\">learn how to position yourself for a stronger financial future<\/a>.<\/span><\/p>\n<hr \/>\n<p>Molly Barnes is a Digital Nomad\u00a0Extraordinaire\u00a0living in a rig, working remotely, and exploring different cities across the United States. She&#8217;s a freelance writer, a vegan, and a bit of a coffee snob. Learn more about Molly and Jacob on Digital Nomad Life.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Being young and broke is a rite of passage that nearly everybody goes through in their early adulthood. And, although it isn\u2019t pleasant, it is highly instructive and can shape you into a more frugal, more savvy, and even more compassionate person \u2014 which will be helpful for yourself and those around you, for the [&hellip;]<\/p>\n","protected":false},"author":37,"featured_media":3308,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":""},"categories":[3],"tags":[],"yst_prominent_words":[2420,2423,2426,2414,2418,23,465,2411,2415,2417,153,2421,2410,2409,2419,2416,2424,2422,74,2412],"_links":{"self":[{"href":"https:\/\/cudoo.com\/blog\/wp-json\/wp\/v2\/posts\/3307"}],"collection":[{"href":"https:\/\/cudoo.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cudoo.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cudoo.com\/blog\/wp-json\/wp\/v2\/users\/37"}],"replies":[{"embeddable":true,"href":"https:\/\/cudoo.com\/blog\/wp-json\/wp\/v2\/comments?post=3307"}],"version-history":[{"count":10,"href":"https:\/\/cudoo.com\/blog\/wp-json\/wp\/v2\/posts\/3307\/revisions"}],"predecessor-version":[{"id":6407,"href":"https:\/\/cudoo.com\/blog\/wp-json\/wp\/v2\/posts\/3307\/revisions\/6407"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cudoo.com\/blog\/wp-json\/wp\/v2\/media\/3308"}],"wp:attachment":[{"href":"https:\/\/cudoo.com\/blog\/wp-json\/wp\/v2\/media?parent=3307"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cudoo.com\/blog\/wp-json\/wp\/v2\/categories?post=3307"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cudoo.com\/blog\/wp-json\/wp\/v2\/tags?post=3307"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/cudoo.com\/blog\/wp-json\/wp\/v2\/yst_prominent_words?post=3307"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}