Well it’s Valentine’s Day and while thousands of couples will be heading out for a night on the town, there are also thousands of singles out there who currently find their facebook relationship status set to single. For some people, a single Valentine’s Day makes for a sad and lonely evening, for other’s it means saving money by not having to go out. While money in the bank might not make up for the loneliness this Valentine’s Day it’s better to look further down the road and realize that saving now, while you’re single, is one of the easiest times to save money.
For some people learning to budget and save money is something that many of us have to learn on our own by trial and error. It is a rare teenager who graduates high school and goes to college who already understands finances and how to manage them.
That being said, it is very important for a single person to learn to budget and save before they get married or even get a ‘real’ job. While learning all of this in college may be difficult, mastering these skills can save you hundreds and even thousands of dollars in the long run.
This is a word that most people cringe when they hear it. For many it carries with it a negative connotation, indicating a restriction of fun and less money to play with. While learning to budget does sometimes mean limiting the ‘fun’ factor at the beginning, it will earn you skills that can help you build the foundation that financial independence is built on.
Budgeting is merely a way to manage your finances so that you don’t have to worry about whether or not you have enough. When you’re starting out, it can be difficult to learn the control that it takes to not blow your budget on a spending spree, but over time, you will begin to understand how to properly manage your finances.
The key to a successful budget is saving. When you are single, it is tempting to spend all your extra money on the fun things you could be doing right now. But when your car breaks, or you suddenly find yourself needing to search for new housing arrangements, not having money in the bank means your choices in these situations are severely limited.
When saving, you want to set aside the same amount of money each month, working to slowly build up and then maintain a savings account that holds enough to support you in your current living situation for a 3-6 month period of time. This emergency fund should be the first thing you focus on as you learn to budget and save.
While living on a budget, specifically a small one can be tough, it is important that you leave some money each month for you to play with or, if you prefer, put some money toward a larger luxury item or trip that you really want. Whether you just want to be able to go to a movie once a month or you want to save for your dream vacation getaway, make sure you are spending some of your money on what YOU want to spend it on.
Understanding the difference between ‘want’ and ‘need’ is vital when developing your budget. ‘Needs’ include things like food, clothing, shelter, and basic utilities like electricity, water and a full emergency fund, while your ‘wants’ may be that designer shirt you’ve had your eye on, or the latest piece of mobile technology. Learn the difference between the two and only spend money on the ‘wants’ when you have all your ‘needs’ covered.
Learn how to manage your money now, before you need to merge your finances with another person. Being financially responsible is a skill like any other, and for some it may come easy, while the rest of us will spend our entire lives learning how to do it. Either way, get started, and you won’t be sorry.