These days it seems like everyone is a little crunched for money, or not quite as...generous...as they used to be, especially for those just out of college or in their twenties. Money is definitely an issue. It always has been, but with the recession and the job market, people are finding the crunch harder and harder to bear.
But if you really want to make sure that you aren't penniless by the time you hit 40 (this is an exaggeration, really) you're probably going to want to think long and hard about your personal finances. What follows are 3 simple things that we all can do to help personal fiscal security.
Keep Track of Spending
This may seem like an obvious statement (in fact, most of these are pretty "obvious") but you're actually going to want to track and review what you spend each month - and on what. The best way to do this in this day and age is a personal finance application on your phone, so that when you spend something you can automatically enter it in to track - as well as see at that moment what your financial health is.
Probably the most talked about app is Mint.com - it's available both for your phone, online, and for your tablet. While you do have the ability to set budgets, at this point in time the budgets are only on a monthly basis. As a current user, what is most useful about Mint is that I can actually see all of my accounts in one location, rather than logging in to each individual bank or credit card or investment account.
Beyond just keeping track of your spending you're going to want to actively set budgets and actually follow said budget. It's hard and will take some getting used to if you're a person who relies on plastic and impulse buys, but in the long run setting a reasonable budget that you can actually live on will be great for you.
Know What You're Worth And Spend Less Than You Make
If you find that when you're setting your budgets you can't live within your means unless you use credit cards or rely on your parents to pay some of your bills...well, then, something is awry.
The important thing here is to actually understand what you are worth to your company - and do your research! The same goes if you're interviewing for a new position and get a job offer. Know what the average cost of living is in the city or town, and have a grasp monetarily of what your experience brings to the table. Don't be afraid to negotiate salary or ask for a raise. If a company truly wants your skills, then most (even in this economy) will be open to some sort of salary bump - rarely are salaries the bottom line when it comes to what the company can afford to offer you.
When you enter the workforce - no matter your age, you should not only start immediately contributing to a 401K (or whatever equivalent your company offers) but also start saving some sort of emergency fund, typically you want to aim for 3 - 6 months of expenses in your "golden parachute."
Even if you open a savings account and only contribute the monthly minimum, it will help you in the long run. The best practice, though, if you can manage it, is to set aside 5 - 10% of each paycheck to some sort of savings (other than the retirement plan) before you even start budgeting for the month.
Laura Green is a freelance writer who thinks that everyone should organize their investments or their money - by investment asset class or however they feel like it. She hopes that everyone has the ability to live within their means!