- Do not buy it. Whatever the “it” is … If the consideration process for a frivolous purchase lasts more than a few seconds, chances are you don’t need that item. Draw a clear distinction between your needs and wants. If it’s a want, most likely you can take the time to save for it and might ultimately decide not to buy it at all.
- Credit is money … ultimately. In my younger days I really enjoyed playing the role of high-roller: wining and dining and living it up. My pool of friends grew but my credit score suffered. Lenders use your credit score to determine whether to lend to you, and nowadays many potential employers consider it when deciding whether to hire you, also. Take advantage of the free annual credit report offered by www.annualcreditreport.com to get an idea of where you stand. Knowing your credit score and promptly acting on any issues on your credit report can start you on the way better finances.
- Protect your personal information. Be vigilantly cautious on the Web and with printed mail, also. Consider shredding documents with your name or address on it that you don’t need to keep record of. Good examples are those credit card offers that may be better shredded than activated (see second bullet point for reasons to shred the offer).
- Learn. Although it might seem complex, the financial markets really aren’t difficult to learn and you don’t need to be a stock market wizard to navigate them. Take advantage of the plethora of free online financial resources. Be sure to check the site’s credibility. Sites like Morningstar can help you decide among mutual funds. Likewise, learn about what compound interest is and what it means to you. This U.S. News and World Report article is a primer that might inspire you to learn more.