Money management skills can make or break a person’s future. Poor money habits can lead to zero savings and high debt while good money habits can lead to financial independence and secure life. Especially during uncertain times like this during the COVID-19 pandemic, it is crucial to make sure you are on track with your finances.
Gen Z and millennials need to learn how to manage money wisely since a misstep can lead to financial disasters. Just like health, wealth is an important component of life. Here are 3 important money lessons for youngsters who are starting to build their financial portfolios, especially during COVID-19.
Budget, track and spend wisely
Once you get your salary, it is crucial to allocate your income to necessities, debts, savings, and so on. One of the most popular budgeting rules is the 50/30/20 rule popularised by US Senator Elizabeth Warren. She suggests that 50% of income should be allocated for needs, 30% for wants, and 20% for savings. Having a solid budget system will prevent you from spending all of your money mindlessly.
There are hundreds of money management apps that will make your life easy by helping you to keep track of your spending habits. All you need to do is key in the numbers and voila! You will have a record of where your money went.
Get close to investing
Fun Fact: You don’t have to be rich or earn a five-figure salary to start investing. You can start with as low as RM1,000 and choose low-risk options to start with.
For instance, Robo advisor platforms such as StashAway use artificial intelligence (AI) to invest your money according to your risk preferences and financial goals. However, it is crucial that you invest after building an emergency fund that can cover 3-6 months’ expenses.
Do your research, diversify, and keep the risk low before you decide to jump into the world of investing that can be highly rewarding in the long run!
Multiply your sources of income during and post COVID-19 pandemic
Having a part-time job or a side hustle will increase your income and can pave the way towards a financially secure life. You can benefit greatly from the side hustle opportunities online without jeopardising your full-time job.
One of the most popular side hustles is affiliate marketing where you can promote products from top brands to your social media following. Every time someone uses your affiliate link to make a purchase, you will get commissions, even during the COVID-19 pandemic. Here’s how Cik Cira started earning money via affiliate marketing after quitting her job during the COVID-19 pandemic.
More so, if you register with an affiliate marketing platform that can connect you to various top brands so that you can promote various products from various brands. For instance, ACCESSTRADE MY actively recruits affiliate marketers and provides insightful training for those who register to be part of the affiliate marketing community!
One step at a time
Financial security is a long-term goal. However, you have to start making the effort right now to enjoy the fruits of your labour. Start by making small changes like downloading a budget app or registering to ACCESSTRADE MY and try your hands at being an affiliate marketer.