The journey to financial wisdom is filled with lessons that many only learn later in life. Managing money isn’t just about making budgets; it’s about making better choices every day. CA Nitin Kaushik has shared eight crucial money lessons that everyone should learn before turning 30. These lessons are designed to help young individuals make smarter financial decisions and secure their financial freedom early on.
1. Cheap Gadgets Cost More in the Long Run
Kaushik stresses that investing in quality electronics will save money in the long term. "Cheap electronics = expensive replacements," he advises. Whether it’s a gadget, an appliance, or a car, opting for quality from the start often leads to fewer expenses down the road.
2. Don’t Spend a Fortune if You Are Renting
When renting, avoid buying expensive furniture that will add to your moving costs later. The idea is to focus on purchases that bring lasting value and avoid making decisions based on short-term savings.
3. Practical Savings Tips
Kaushik recommends saving at least 5% of your salary in cash. Holding physical money helps you be more mindful of your spending and keeps impulsive decisions in check.
4. Don’t Follow Phone Trends Blindly
Opt for a phone that serves your needs without falling into the trap of constantly upgrading to the latest model. Expensive gadgets often lose value quickly, and spending unnecessarily on phones drains savings for no reason.
5. No Health Insurance? You’re Taking a Big Risk
Many young people skip health insurance, thinking they’re healthy enough. However, one unexpected hospital bill can wipe out months of savings. Kaushik emphasizes that securing your health is just as important as managing your finances.
6. Your Diet Affects Your Wallet Too
Kaushik points out that an unhealthy diet not only harms your body but also leads to higher medical bills. By cutting sugar and palm oil, you can save money on medical expenses in the long run.
7. A Credit Card Isn’t Free Money
While credit cards can be helpful if used correctly, they can also lead to debt if not handled carefully. Kaushik warns against treating credit cards as an extension of your income and advises using them only for emergencies, not daily purchases.
8. Choose a Partner Who Respects Money
Choosing a financially savvy partner is key to long-term financial stability. Kaushik humorously notes, "Date someone who understands finance. Love doesn’t pay EMIs." Financial compatibility is important in relationships to avoid future conflicts over money.
Kaushik concludes by saying, "Money saved is freedom earned." In simple terms, the smart choices you make early in life will provide you with the freedom and security to live a more fulfilling life. By focusing on long-term goals and understanding the importance of each financial decision, you can set yourself up for a future of financial independence.
