Tips for Smart Money Management and a Successful Future

(BPT) - The average American has a consumer debt balance of nearly $97,000, proving that financial literacy is critical to young generations as they look to exercise their spending power. Gen Z, which refers to people currently 10 to 25 years old, holds $360 billion in disposable income, according to Bloomberg. With all this money and buying power, it provides an opportunity for this current generation of youth to learn positive money habits in hopes of avoiding pitfalls of other generations, and in turn put their disposable income toward saving for a successful future.

While 27 states require a stand-alone personal finance course be offered in high school, surprisingly only eight states in the country guarantee access to a mandated stand-alone personal finance class as a high school graduation requirement. October marks Financial Planning Month and luckily, there are several programs young spenders can participate in to learn about saving, wise spending and everything in between.

One such program, Money Matters, developed in partnership with the Charles Schwab Foundation, has reached more than 1 million Boys & Girls Club teens since 2004 and helps to teach financial responsibility to today’s youth. The program's teen ambassador, Sierra McCarthy, a first-generation college student at Marquette University who attended Boys & Girls Clubs of Greater Milwaukee, developed a few tips for individuals looking to be more financially responsible and independent.

“When I started earning money from my first job, it opened up many doors to new experiences, new freedoms and new financial areas that I didn’t know how to plan well,” said McCarthy. “Money Matters and using these tips helped me form better financial habits and work toward my financial goals.”

Whether you’re a teen or an adult trying to better your money management habits and save for the future, try incorporating the following tips.

Find a summer or after-school job

Getting a job offers personal financial freedom and opportunities early on to learn how to manage the money you earn. Before graduating high school and going out on your own, it's important to sit down and better understand what it takes to make ends meet while living the lifestyle you want. Gaining early insight into how working sets you up for success in life is invaluable. COVID realities may have put an initial halt on summer or after-school jobs, but as restrictions lift across the world, the economy is ready for ambitious workers who are willing to learn.

Goal set and money plan

As soon as you start earning an income, it is wise to begin saving immediately while also building a budget for your monthly net pay so you can plan accordingly to hit future savings goals.

“Money Matters taught me the ‘50/30/20 rule,’ where 50% of your net pay goes to needs such as food and transportation; 30% goes toward wants, like entertainment; and 20% goes to savings,” said McCarthy.

As you look to set budget goals, try to plan for short-, mid- and long-term goals as it can help to see the positive progress you are making toward achieving long-term objectives and ensure you do not get deterred.

Take advantage of tech

Nowadays there’s an app for everything and managing your money is no exception. Take time to sit down and research what apps you can take advantage of to help build better money habits. Whether it's budgeting, tracking or apps that highlight deals and sales, these are easy ways to become financially savvy by using what’s available at your fingertips.

Follow financial influencers

Most individuals follow all types of influencers, so why not start following a few in the financial field? Find a financial influencer that connects with your lifestyle and follow them for inspiration and tips. This is a good way to learn smart new approaches to budgeting and saving. Social media can help connect people and encourage new ways of thinking that you may not have tried before. Be sure to always do your own due diligence and research before implementing something.

All these tips and tricks can help foster smart, consistent and fruitful money management habits. Becoming financially literate at a young age will help individuals build successful futures and can eliminate some financial stress of not knowing how to acquire, maintain and manage money.

“Before Money Matters, I had a general idea and understanding of budgeting and saving, but I didn’t know how saving money could work toward my goals,” reflects McCarthy. “Money Matters has changed my perspective on money by showing me how quickly your savings grows if you follow a plan.”