Whether you are well educated or not, everyone who has to work for a living has financial goals. Sometimes they are very big goals and sometimes they can just be small things that you would like to achieve. In order to make any financial goal really happen, you usually have to have a plan. Goals do not achieve themselves. The bigger the goal, the bigger the plan you will have to have and probably the longer it will take to get there.
It has always been a common practice, especially in the past fifty years, for a lot of people to bypass the art of saving for a particular item like a new car or home and head straight to the bank and borrow your way to whatever it is you want when your credit is good enough. When one of your financial goals is to save money, making purchases like these on credit can really put a dent in any money you would like to save. Almost all of us must have a car to drive and must have a home to live in, but which car and what home is the question.
Especially if you are just starting out on your own, it is better to not plunge yourself so far in debt that you never have anything left over to save. In recent years when it has become so much easier to get lines of credit thrown at you from every direction for almost anything, it can be a terrible temptation for young singles or couples to not take advantage of these credit offers. The thing is that by using so many forms of credit, you are going deep into debt and will be using the majority of your income to pay bills. This can make it so hard to reach other goals such as saving money very difficult.
Before you go into debt for a new car or a home that will cost you so every month, consider if you would be better off to drive and live in something less expensive even if it is possible for you to meet the payments. Spending out less of your income for things now that you will have to pay a large amount of interest on to have will be less intelligent than having less expensive things and investing the extra money you have left over into an IRA or other investments that will earn interest for you. |
