Financial Advice for Every Stage of Life

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April is tax time as well as National Financial Literacy Month: two good reasons to look at where you’ve been and where you’re going with your finances.

“Unlike weeds or government debt, money does not grow on its own,” says Bill Hardekopf, CEO of and author of The Credit Card Guidebook. “Building financial security through all stages of life requires a plan and plenty of attention.”

Here are some tips for managing money at different stages of life:


  • Pay yourself first. Teenagers receive money for birthdays, allowance, and jobs. Learn at this early age to pay yourself first and put some money into a savings or investment account. This is one of the best habits you can develop. Stick to this, and you will be surprised how even small sums of money can grow. You can even collect loose change and add to this. Every little bit adds up.
  • Make a budget. If you don’t keep track of your spending, you will not understand where your money goes. Keep a list of every expense, no matter how small. This will make you think twice about the importance of each purchase.

Young adults

  • Save money. If you are single or married without kids, this is the least expensive time of your life. You finally have control of your own money, and it may even feel like a lot of money. You can spend it all on clothes, cars, furniture, and entertainment, or you can spend smartly and save for the future. You may have just graduated from school, but this is best time to plan for retirement. Maximize your retirement accounts because even though the stock market is volatile, time and compounding growth are on your side.
  • Build up your credit score. Test scores are behind you, and now is the time to focus on your credit score. This score is more important than any exam because it is how lenders judge you. Your credit score affects the terms and interest rates for all loans – credit card, mortgage, and auto. The higher your credit score, the lower your interest rates, resulting in more money you can keep. Your payment history and how you handle money is so important that employers may even look at your credit report during the interview process to help screen applicants who may be unreliable or a risk of theft.


  • Full disclosure of debt and financial obligations. Tell your partner before the wedding about all of your debt. It is not fair to wait until the first bills come in. Make a list of all student loans, car loans, credit card debt, even loans to friends and parents. Get copies of credit reports to verify all open accounts. One or both of you may enter the partnership with debt, but debt payments drain away money you could be saving to help you reach financial goals. If either partner has problems with credit, your rental or mortgage application may be denied, or you may have to pay more money on loans with higher rates.
  • Joint or individual bank accounts
    Will you have one bank account for all income and expenses, or will you start with three accounts–yours, mine, and ours? A joint account is easier to manage and will prevent some disagreements over dividing bills, but decisions need to be shared. It gives each partner some control over their own spending. Couples tend to gravitate toward joint accounts once they add children and major expenses. If you choose to have separate accounts, develop a plan outlining which account pays each bill before the first bills arrive.


  • Save for college. The best time to begin saving for college is the day you bring the baby home. There are college savings plans with tax benefits. Look at state-sponsored 529 plans and educational savings accounts.
  • Inheritance and windfalls. You may receive money from a home sale, inheritance, or insurance payment. This is a great chance to pay off high-interest debt, like credit cards or auto loans. It is also a good time to fully fund an emergency fund (six months of household income), and put more money into your retirement account.
  • Teach children about finances. You can set a good example for your kids of saving, spending wisely, and charitable giving. It is easier for them to understand when they watch you do it. Take them shopping with you and show them how to compare prices and find good deals. Let them see you put something back because it cost too much. Open a bank account for them and let them make deposits into their own account. Show them the interest and balance growing on their monthly statement. Give them an allowance and let them make their own decisions about this money. Let them save and pay for the toys and games they really want. This also gives them a chance to make mistakes with money and experience the emotions and understanding that once money is spent, it is gone.

Preparing for retirement

  • Max out your retirement savings. You may still be paying for your children’s college education, but it is just as important that you save all you can for your retirement. If you retire at 65, will your retirement savings sustain you for 20 years or more? It is a good idea to save 10 to 20 percent of your annual income for retirement. Max out your employer’s retirement plans, and your individual retirement accounts (IRAs).
  • Pay off your debt. It is easier to pay off credit card and other debt now while you have income. Start with the card with the highest interest rate and pay as much as you can above the minimum balance. You can even skip dinner at a restaurant and immediately log in to your account to apply that money to your credit card.
  • Have a plan to make your savings last. Today, seniors have a longer life and their retirement savings has to last longer. This may be difficult if your investments are still recovering from the recent financial turmoil. Developing a plan and a budget may require the help of a financial adviser. The FDIC provides some good information on how to help your money last after your last paycheck: Check it out at this page of their website.

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