The 'B' word every kid can use
Winning strategies for a budget-conscious youth
by Candi Sparks and Queon L. Martin
To "B" or not to "B" in general, budgeting gets a pretty bad rap. Youth tend to think that a budget is a list of things you deny yourself. This negative mindset is what is driving the credit crunch. A budget is actually a plan for saving, spending and accumulating money. I think of budgeting like having "Now and Later" candy. You would get "Now and Later" candy to have some now, and save some for later on. It would help if we think about our money like a "Now and Later." We need to spend money now, but if we use it all now, there won't be any for later. And, if we are going to have enough money for an emergency, or to buy a house or to retire, we will surely need to have our money working for us. We've heard the cliché' that "it takes money to make money." Right now, our money can be working for us to accumulate interest payments in investments. This is why a budget has to involve the three prongs of spending, saving and accumulating money. A budget is a money plan for "now and later." This is a great way to introduce the concept of budgeting to yourself. You will need money "now and later" and budgeting is a plan to do it.
- Money is not just for spending. You need a plan to save, spend and accumulate money so you will have it "now and later."
- Money is not unlimited. Once you spend it, it is gone. You can run out of money if you don't keep some saved or put aside for growth.
- Purchases should be planned. Impulse buying is one of the fastest ways to spend too much money.
- Gratification can be delayed until we can afford what we want. The things that we want will still be there next week, and might even change from week to week.
- Unexpected emergencies happen that require cash. Medical situations, an extra cab ride in inclement weather, lay offs.... to name just a few.
- Long-term financial goals are easier to reach if you start early and stay on course.
Here are some steps to help you learn how to budget and to feel positive about it.
2. This is not the time to gripe about the economy or not having enough money. Remember, we are all experiencing the downturn. You may not understand everything that is going on in the economy, but I hope we at Hip-HopTV24/7.org Incorporated are helping with you having a better understanding of what's going on in the nation and the world by providing you with information that is essential to improving your way of life. If not email us @ info@hiphoptv247.org with your concerns. Instead of complaining, be proactive about what you can do to get on track and stay on track financially.
3. In learning the spending aspect of budgeting, use cash as much as possible. Trips to the grocery store, school supplies and haircuts can be paid using cash. The reason being, we have a stronger emotional connection to cash, and it is a great visual example that once the cash in your wallet has been spent, it's gone. Another good reason to use cash is that a "budget" is really about how much cash you have and what you can actually afford to spend.
4. With the incessant marketing of credit cards and loans, you will need to find ways to overcome the tremendous appeal that plastic has. Youth get the false impression that if you use plastic, you "never run out of money" or that "you didn't have to pay." If you use too much credit you will never have any money of your own! In budgeting, cash is king. Pay in cash and keep track of how much cash is spent, and what it is being spent on.
5. This rule is so underrated; Parents don't be a "financial water faucet." If every time your child "run out of money" you bail them out by giving them more cash, you could wind up with a thirty-year old living in your basement. You can avoid this if they learn early on, that you are not going to replenish the money for them. They can learn from first hand experience that you have to earn money before you spend it. This will allow them to see and eventually experience spending every cent you get your hands on is NOT the way to take care of yourself. After all your child wants to be around now and later, right?
6. Never see budgeting in a negative way. A budget is what a smart person does so that he or she will have money "now and later." Everyone knows that money can help one to feel secure and comfortable (just like having good health and being in your right mind). Have a positive attitude towards budgeting. Budgeting is a great way to make dreams come true.
7. Try writing out a savings plan for long term goals. Is it a holiday gift you are saving to buy a love one? Are you saving for college? You want to go on vacation? You want to buy a car or a home? Work within your budget as you will see results in the long run in obtaining your goal.
8. If possible, take a calculator on shopping trips and keep a running tally of how much is being spent before you get to the check out counter. If you have gone over your budget, begin to breakdown which items you "want" and which items you "need." Put back the items you "want" as you can always come back another time to purchase it. This helps you understand that purchases should be planned and given thought.
9. If you want something from the store that you had not planned to buy, don't rush to buy it. Put that item in the budget and save up for it. Plan how and when you will be able to afford it.
10. Be a role model to your peers. They see how budgeting and saving money has benefited you. Buy items on sale, as this can help you with your goal of purchasing your dream item in the future. When you get change from your purchases, put it aside in a "change jar" as this can help you out on saving extra cash. After following these rules, in time you will understand the meaning of budgeting and the importance of it.
Hip-HopTV24/7.org Incorporated, edcuating the minds of youth with information that is essential to improving their way of life.
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