In school growing up we learned a lot about math, English, American history, science, and even art but we never really took on the curriculum of finances. Finances was a subject that you later picked up in college if you choose to study that however it’s one that would still have been very beneficial to have in high school in my opinion. Seems like without proper knowledge on how to mind your finances early in life could give you a trail and error type of experience when you enter into adulthood and start to figure out how finances really work . When I was younger I had no idea how much debit I was about to put myself in through the pursue of my material desires and how long it would actually take me to stabilize my finances. It’s definitely a subject that still leaves most in wonderment about how it works or how to cultivated it in the most affective and beneficial way for yourself.
I bought my first car when I was about 16 years old and before the age of 22 I had bought about 5 cars in between that time. All of them had been cars that I paid cash for and accepted “ as is “. So of course I had a lot of mechanical problems along the way and at some point with each car I eventually had to scrap the car and work on acquiring a new car after the previous car had came to it’s end. By the age of 22 I realized that I wanted a newer car and one that came with regular maintenance from the dealer so that I wouldn’t have to invest so much of my money into fixing the car whenever it had a sudden mechanical problems. When I brought this up to my Dad of course it was time for “ The Talk”. The talk about credit! Up until this point I hadn’t established any credit yet and I had no debit. The simple joy of being debit free and young. If I only knew then what I know now things would have been a lot easier for me. My Dad explained to me a little about how credit worked and it being a new subject of course I didn’t take heed until much later into my twenties. I wanted a new car so badly I was willing to do whatever and pay whatever just to have that brand new feeling when driving a new car. At this point I was working as a hairstylist already and I had acquired a pretty good clientele so I was now in a position where I could pay a car note if I wanted to. So I set out to get a new car being blind to what I would be in for as I started to acquire things with payments attached to them. For the first few years I actually did very well up until the point when I moved to California. Of course the move depleted all my finances and I eventually lost the car that I was making payments on. I realized that even tho you could have been paying on something for two years it could still be lost and you would still be left with the debit of what you owed. By the time I was 24 I had acquired thousands of dollars in debit from student loans and missed car payments. It wouldn’t be until 7 years later that some of those things would fall off my credit.
Credit is basically a promise to pay. So when you use your credit card its like saying I don’t have all the money now but this lender trusts me enough to pay this amount of money on my behalf and I will pay them back at a later date and they will do this for me along with charging me a fee for doing it. When you have a good history of paying money back then you have good credit. Of course there are levels to it and it has taken me years to get a clear and concise understanding of how credit works and how to make it work on my behalf. Because I was in so much debit it was hard for me to qualify for things such as an apartment, another “ new “ car, or even any type of credit card or loan. Finding myself in a broad doggy dog world that doesn’t care if you can survive or not I started to understand through trial and much error how important it was to cultivate more knowledge in the financial department.
When in so much debit and a feeling of being so far behind it can be challenging and daunting to figure out where to even start fixing your finances. Of course there are several factors to consider. You have to stabilize your finance first which can be difficult for a stylist who is trying to also build a clientele and has no other forms of income. When I found myself unable to qualify for an apartment I knew that something had to be done about my financial literacy and that I needed to start taking steps into learning how to get myself financially together. By the grace of God I acquired a client who was a financial advisor and her noticing my situation started to coach me on how to get things in order for myself. First thing I needed to learn was how to save my money better. I already know a little bit bout saving money because I always had to pay cash for things so I was accustom to putting up money for things. But I was accustom to saving money and then when I acquired a certain amount I would spend it quickly. Then I would be at square one again tying to save and praying that I didn’t come across a financial emergency while I was saving. First thing I learned was that I needed to have an emergency fund. Having $1000 saved that you don’t touch is a great feeling of security that allows you to feel better about your financial situation. The first time I saved that much and couldn’t spend it was very hard. After I saved it up it seemed like everything I didn’t need was screaming my name. A new computer, more clothes or shoes, better tools to work with in the salon, etc. I had to practice a lot of self control in order to get further than just the emergency cash. Once I did, saving actually started to become second nature. Soon I had two sets of emergency funds and two months rent set aside in case anything happened to me. I have to admit while in this process it was saddening to see people flossing their latest things and seeing myself still rocking old clothes and cleaning my shoes all the time to make them look new again. This process taught me to value what I have and to take care of the things I have. It’s something that I always do now and as you acquire more you learn to take care of the things you acquire so that they will last. It also teaches you how to spend your money better. Do you spend lots of money on things that will parish in a short amount of time or will you spend money on things that will last awhile.
Up until this point I hadn’t acquired a car note for some time and now I was ready to. Having a better understanding of my credit and the importance of saving I could now start to establish my credit again through a car note. Once I did I developed a good balance. I now had a system of on time payments, emergency cash, and savings for things that I needed when I needed them. After that point I was then ready to start saving for my retirement and future. To do this I needed to start investing. I needed to start putting money away in a few investments that could grow more money for me over time. The good thing was that I had learned how to save money and to forget about it which had taken me a long time to do. But now I was in a better space mentally for the task and was ready to make a few moves.
Since saving money more effectively I have been able to start a few investments and even by some stocks on the stock market. Through setting myself up this way I have developed a better feeling of security which releases me from the anxiety I used to have over my life and financial status. I always try to remind young stylist to invest and save their money. I heard it a lot from veteran stylist as I was coming up but once I got older I could understand “ how “ to save the money that comes in to me. If I had known how to invest and save earlier I would have been a lot further now however it is always good to start whenever you know better. It’s not to late to get things on track if they’re not and you can alway start with at least having that emergency cash set aside. Life is full of different things that happen in life and it’s a great feeling when you now that you will be alright if something happens. I encourage everyone to get more familiar with investing for the future. Although it can be hard to understand at first, after while it gets easier and can be fun. So gratifying when you know that you are cultivating that type of beneficial knowledge into your life.
- G
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