20 Financial To Do’s Before You Hit 30


15. Embrace Frugality

Anyone who knows me will tell you I am probably the most frugal person on earth.

Except for family, I don’t treat anyone on my birthday. For me, it is a usurious tradition. I don’t celebrate Valentine’s Day because it has no historical significance and is just an excuse for restaurants and florists to triple their prices.

I bring my own food and water to work or at the gym. I wear the same clothes from 10, 15 years ago. I don’t buy new jeans; I have my old ones altered. I always bring empties to buy beer. I get 60 Peso haircuts.

I only get a new cell phone when my carrier gives me one for free. That means every two years.

The PC I’m using to write this article is seven years old.

There’s nothing wrong with being frugal. NBA Star LeBron James who makes 20-30 Million US Dollars a year is reportedly so frugal he won’t even spend on wi-fi!

16. Borrowing is NEVER the Solution

In 2012, when the bank called to inform me that our housing loan was approved it was one of the happiest days of my life.

Two years later the housing loan became my worst nightmare.

I had been paying conscientiously for two years until the well was dried up. Upon the advice of my accountant and lawyer, I decided to negotiate and restructure the housing loan.

I was shocked that upon getting my loan balance, the principal amount had hardly moved!

The lesson I want to share with you 30 and under readers is this:

A house is a great thing to own. It is the pinnacle of your accomplishment as a career person and as a provider. But it is also the largest investment you will ever make in your life.

I bought a house through a loan program because I misled myself to believe that good times in business will last a lifetime. Unfortunately for me, its lifetime was cut short.

As a rule, do not borrow unless the amortization covers more than 25% of your monthly income and you can be assured of tenure.

If you want to buy the house of your dreams, work for it and save up. If you need to buy a house now, look for one that you can afford given your finances.

17. Get Life Insurance

When you’re 30 or under, insurance premiums are very affordable. Insurance plans are important to make sure you and your loved ones are covered for any future eventuality.

The first thing to do is to find a reputable and reliable insurance provider. There are many insurance agencies in the market, but not all may service your needs or budget.

Look for agencies that offer flexible or variable payment plans such as term insurance.

18. Run Your Profits, Cut Your Losses

If you have decided to invest and things turn out for the best, keep it going until you have a basis for liquidating your profits.

But if things go south, and all indications have gone contrary to expectations; do not hesitate to cut your losses.

This advice would serve you well if you invested in stocks or business. You can always recover your losses as long as these are kept minimal. I have met many young people who have lost hundreds of thousands in the stock market because of undisciplined trading.

Again, you should have an idea of how much capital you can afford to lose.

19. Keep Your Circle Close and Exclusive

As you go through your young career, you will meet several people who will give you their ideas on investments and how to spend your money.

The first thing you should do is walk away from anyone who says they have a guaranteed way of doubling your money in the fastest time possible. There’s a word for these people: Scammers.

The second thing you should do is to remove people from your life who encourage you to spend unnecessarily. They are enablers. They will bleed you dry then leave when they have had their fill.

The third thing you should do is stay clear from people who keep asking for money. I may be frugal, but I’d like to think I am reasonably generous. However, I do not support hand-outs.

If you are able-bodied, educated and have a steady income or an existing business, there is no valid reason why you should be asking for money. It only tells me you have become financially irresponsible and should be accountable for the mistakes you have made.

Do not let anyone dictate what you do with your money. It is yours; you worked and sacrificed for it.

If they drop you because you said “No,” trust me, you are better off not having them in your life.

They are nothing but “fair-weathered friends”.

I also keep a small circle of people I can trust for financial advice: My dad, my accountant and my cousin who is a highly-experienced fund manager.

20. Don’t Live Beyond Your Means

I’m sure like me, you know someone who always showed up in the trendiest clothes, drove the fanciest car, owned the latest gadgets and ate at the most expensive restaurants.

In the case of my friend, he lost his house and everything he owned. He lived a life he could not afford not because he wanted to. He felt he had to “Compete with the Joneses.”

Be mature with your decision-making; don’t let the success of others dictate the path you tread on.

Moving forward

Money is not everything. You should not make it the center of your universe. In its barest essence, money is just a currency that allows you to purchase goods and services.

But you should be financially responsible with the money you make. Nurture it and allow it to grow so you have a source to go to in your time of need. Remember, it takes time for trees to bear fruit. There is no later time to start than now.

Money gives you a false sense of entitlement. Real power is mastery over money and having it work for you instead of the other way around.

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