Recently I was researching some specific exercises to add to my workout regime. I watched several instructional videos on YouTube until I found the one that I thought would fit with my exercise goals. As I was following along with the instructor, I heard her say “Be intentional when you do these exercises or you won’t get the results you want.” That phrase, “be intentional,” stuck with me, and I knew it was one that applies not just to exercise but to financial habits as well. When developing financial habits, unless we are intentional, we may never reach our financial goals.
In teaching high school students, here are five key financial activities I want my students to become intentional with:
- Be intentional about maintaining and increasing your income. Minimize the number of times you leave work early or call in sick. The two hours you leave early equals $20 that could buy gas or pay part of your cell phone bill. Volunteer to cover shifts for other employees. If you pick up 4 extra hours per week, you can increase your income by $2000 a year. Increase your skill level so you are worth more to your employer. Look for opportunities to develop your human capital so you can apply for a new job at a higher wage.
- Be intentional in tracking your spending. Not knowing where your money goes is an easy way to end up living paycheck to paycheck. If you’re not very good at saving receipts or tracking expenses in a spreadsheet, download a finance app such as GoodBudget or Mint. Technology tools can help you uncover where your money is actually going. And knowing where your money is going is the first step to implementing necessary spending changes.
- Be intentional in identifying needs versus wants. When your parents are paying your major expenses, it’s easy to fall into the habit of spending your money on anything you want. Eating out daily, new clothing purchases, and expensive cell phones are easy financial expenses to pay when you can spend your money however you want. But when you move out, it’s hard to give up those habits so you can pay your rent, and insurance, and buy food from the grocery store. Identify NOW what you really need and learn to do without some of those expensive wants.
- Be intentional about creating an emergency fund. Each of us will face uncertainties in our future. Employment changes, family situations, and accidents can all create a strain on your finances. Plan now to take money out of every paycheck for your emergency fund. You will feel better prepared when something goes wrong.
- Be intentional about saving for your future. Develop the saving habit NOW. Saving $20 from your weekly paycheck will allow you to save over $1000 a year. Cutting out one $5 lunch per week, packing your own lunch and saving that money instead will allow you to save $260 a year. When you are an intentional saver, you truly can put your money to work for you.
Experts say you need to do something for at least 21 days to develop a habit. Make a commitment to be intentional in developing positive financial habits. The stability you create in your financial life will be well worth the effort.