Most kids have some idea of what they want to be when the grow-up. Unfortunately, landing a position as a pirate or princess isn’t always easy. On the other hand, one thing that we all get to be when we grow up—whether we like it or not—is a consumer. While being a consumer isn’t as glamorous as being a Superhero, it is important and does require a lot of training.
Learning to be a good consumer is important as it offers a basis for financial success; but many American students complete 12 years of schooling in which little or no attention is paid to economics. As a result, many consumers find themselves on their own to learn from the school of hard knocks. In fact, Americans currently owe more than $2.5 trillion in non-mortgage debt and hold little in the way of savings.
Fortunately, there are four very basic tips for wise money management:
1. Live beneath your means. Learn the difference between needs and wants; experts agree that one key to happiness to be happy with what you already have.
2. Expect the unexpected. No one plans to lose a job or suffer from illness. Being prepared for life’s setbacks will give you peace of mind and help you to survive financially if the worst should happen.
3. Plan for tomorrow. Make it a habit to pay yourself first. The earlier you start the better—as they say, the eighth wonder of the world is compound interest.
4. Keep credit under control. The average household owes more than $8,000 in credit card debt. Smart consumers use credit as a tool of convenience, rather than an extension of their income.
Finally, know when to seek help. After all, even the Batman couldn’t do his job without his trusty sidekick.