While we all know how important it is to secure a bag or multiple bags, it’s also important to manage them properly.
Implementing good money management in your early 20s can seem like a challenge, but with a few healthy practices, you’ll set yourself up for financial success for years to come.
In an honest conversation about dos and don’t’s of money management during the 2021 ESSENCE GU Summit, Financial Planner Dr. Nicole Garner Scott, Financial Stylist Lilias Folkes John, and Founder of the Finance Bar, Marsha Barnes shared their money mishaps and advice for taking steps towards financial freedom. Scroll through to see give tips to help get you started.
For more of everything you missed at the 2021 ESSENCE GU Summit, head over to ESSENCE Studios.
The 2021 Girls United Summit is presented by CBS Original The Equalizer and sponsored by American Airlines and McDonald’s.
You have to make your money work for you
Sharing a money lesson she learned in her early 20s, Dr. Garner Scott spoke about making your money work for you. “I didn’t understand my dollars needed to go to work just as I did,” she said. “You have to put your dollars to work, if you don’t they will relax themselves into oblivion.”
You don’t have to make big purchases as soon as you get a big check
Marsha spoke about her first big purchase being a BMW after she earned her first big corporate title. “I wanted the BMW because as soon as I got an important job title, and I thought I had to have the car to match that,” she said. “We come into this world not wanting to be left out…we have to get to the root issue where that comes from.”
It’s never too early to start building your wealth
According to Lilias, it’s better to own the jeans than it is to wear the brand. It’s not that you can’t enjoy cute items and nice purchases, but you also want to watch your money work for you. “Buy one pair of jeans then buy stock in it because that’s how you’re going to build your wealth,” she said.
Watch out for the “lifestyle creep”
Tonya Rapley advised young adults to be mindful of what comes along with keeping up an expensive purchase after the initial spend. “You might be able to afford the initial payment [for that expensive buy],” she said. “But, the additional cost of owning and maintaining that thing contributes to your lifestyle creep where you’re like, “I didn’t plan for that.”
Take advantage of investment opportunities
With so many apps and platforms for stocks available today, it’s easier than ever to invest as a beginner. Lilias encouraged every woman in her early years to put a few dollars into a stock. “It’s so easy to buy into investments now, back in the day you had to have real money to get into investing,” she said. “Many places will let you start with little to no money; you can put as little as $5 into a stock.”`