How to learn to manage money?

Often I find myself planning to buy things that I don’t really need and, as a rule, can’t afford. And all because they sell cheap. Anna*, Brazil

Sometimes my friends offer to get together as a group, but it doesn’t come cheap. I like to relax with them. Who likes to say, “Sorry, I don’t have the money for this”? Joan, Australia

DO YOU THINK you never have enough money? If your parents gave you more money, then you would buy a game that you liked. If you were paid a higher salary, you would buy the shoes that you “need” so much. However, instead of getting frustrated with the money you don’t have, why not learn how to manage the money you do have?

If you live with your parents, then you can learn how to manage money later, starting an independent life. But would you like to skydive without first knowing how it works? A person who is rapidly flying down can and will guess what to do. However, it is much better if he gets acquainted with the basic principles of the parachute before the jump!

Likewise, learning how to spend money wisely is best before you are faced with financial matters. “Money gives protection,” wrote King Solomon (Ecclesiastes 7:12, SoP). But they will only protect if you use them wisely. By doing this, you will feel more confident and earn the trust of your parents.

Learn the Basics

Have you asked your parents to explain what it means to run household chores? For example, do you know how much they pay monthly for electricity, water and heating, how much money they spend on food, how much it costs to maintain and repair a car, rent or repay a loan? Perhaps such details will seem uninteresting to you. But do not forget that part of the costs falls on you. In addition, if you live on your own, you will have to pay for everything yourself. Therefore, it would be nice to know about them in advance. Ask your parents to show you some of the accounts and explain how they distribute the funds. Listen carefully.

“A wise man will listen and increase knowledge, and a prudent man will find wise advice,” says the biblical parable (Proverbs 1:5). Anna, whose words were quoted above, says: “Dad taught me to plan expenses and showed me how important organization is in the distribution of the family budget.” And her mother gave other useful advice. “She taught: before you buy something, it is important to compare prices,” says Anna and adds: “Mom managed to buy so many things for a small amount!” What did Anna learn? She says: “Now I can manage my money wisely. By carefully controlling my expenses, I avoid debt whenever possible – I have peace and quiet in my soul.

Don’t forget about tomorrow

Of course, managing money properly in theory is much easier than in practice, especially if you live with your parents and receive pocket money or earn money yourself. Why? Because most of the expenses are covered, most likely, by the parents. Therefore, you probably spend almost all your funds at your own discretion. And that, of course, brings you pleasure. Paresh, a young man from India, says, “Spending money is easy. It’s so cool!” Sarah, a girl from Australia, shares his feelings: “I love shopping so much!”

Peers can also push you to spend money. Elena, 21, says: “Among my peers, shopping is the main entertainment. I noticed that they have an unwritten law: if you want to have fun, spend money.

Of course, you don’t want to be left behind by your friends. But ask yourself: do I spend money with friends because I can afford it, or because I don’t want to lose face? Many spend money to gain popularity among their friends and acquaintances. Such a desire can lead to serious financial difficulties, especially if you have a credit card. Financial consultant Susie Orman warns: “If you want to impress people not with your qualities, but with your possessions, then most likely you will exceed the limit and run into debt.”

Instead of spending all your credit card money or your entire paycheck overnight, why not take Elena’s advice? She says: “When I’m going to spend time with friends, I plan in advance how much I will spend. My salary goes to my bank account and I withdraw only the planned amount. It is also wise, in my opinion, to go shopping only with those friends who spend money frugally and advise you to shop around, and not buy the first thing that comes across” (Proverbs 13:20).

When the answer is “no”

What if you don’t get pocket money and you don’t get paid? While living with your parents, you can still learn a lot about how to manage money. For example, when you ask your parents for money or ask them to buy you something, they may say no. Why? Perhaps your requests go beyond the family budget. And even if your parents would like to buy you this thing, they, by responding in this way, set a fine example of self-control. And this quality is very valuable when it comes to the distribution of funds.

Let’s say it’s not a problem for parents to buy what you ask for. They can still say “no” to you. Perhaps you will consider them stingy. But they are most likely trying to teach you an important truth: your happiness does not depend on getting everything you want. Here is what the Bible says about it: “Whoever loves silver will not be satisfied with silver, and whoever loves riches does not profit from it” (Ecclesiastes 5:9).

In confirmation of the truth of these words, we can cite the example of those teenagers whose parents indulge their every whim. Very soon, such young men and women realize that nothing really pleases them. Whatever they have, they always want to buy something else. Teenagers who are used to getting whatever they ask for can become ungrateful later on. Solomon recorded this warning: “If a slave [or child] is spoiled from childhood, no good will come of it” (Proverbs 29:21, NT).

Time is money

In some countries they say: “Time is money.” That is, it takes time to make money; so wasting time is wasting money. The reverse is also true: “Money is time.” By mindlessly wasting money, you are wasting the time it took to earn it. By learning how to manage your money, you will be able to use your time wisely. What does it mean?

Here is what Elena says: “When I control my expenses, I know how much I need to earn. For example, I think about my expenses in advance and then try to avoid unnecessary waste. Then I don’t have to work hard to pay off big debts. This is how I manage my own time and life.” Don’t you want to be in charge of your own life?