Father’s Day has come and gone. While the nation spent $15.5 billion on their dads — which roughly averages out to $135 per pop — you may have fallen short of your fair share this year. That’s alright. Notice how that voice in the back of your head whenever you try to get a deal sounds a lot like your frugal father.
Your dad, king of the “I don’t want anything” spiel when asked about possible gift ideas, prefers that you saved your money over wasting it on a present he didn’t need. It’s just one of many pieces of financial advice he’s willing to share. In honour of our fathers, let’s take a look at the top personal finance tricks and tips our penny-wise pops would want us to know.
Build a Budget
Though it makes the top of our list, using a household budget is a tip often ignored by the majority of Americans. Over 60% of the country doesn’t follow a financial plan, and this flagrant disregard for their finances can cause a lot of problems. A budget lets you know how much you spend on fixed expenses and variable costs in comparison to your income. Once you work out where your money is going, you can determine if you’re spending your cash wisely or if you need to cut out unhealthy spending habits.
Start Saving As Soon As Possible
If being prepared is your dad’s motto, then this next tip is one he’s probably told you time and time again. Automate your savings as soon as you get a regular job and funnel some of your extra cash into an IRA or retirement fund. Ideally you’ll want to put aside anywhere between 10–20% of your income into savings but we can’t all devote that much of our paychecks. Don’t stress over the amount. Any amount you bank will gain interest over time, so the sooner you start saving the more time you’re giving your cash to accrue compounding interest. Even $20 a month adds up!
Research Responsible Lending Options
Until you’re secure enough to set aside cash for a rainy day fund in addition to your retirement fund, your finances may be unprepared for the unexpected. An unanticipated bill, repair, or medical emergency can wreak havoc with your finances. Though your budget can help off-set their effects, you won’t always have the ability to cover these expenses on your own.
Here’s where dad would suggest looking up a reliable payday lender like the folks at MoneyKey. As an online payday loans lender, they provide small dollar loans ranging between $200 and $1,000 through quick and convenient means. Though relatively small, they offer a practical stopgap between paychecks when simple repairs and other non-recurring purchases blindside you and your budget.
Learn How to Negotiate
The sharing economy has transformed the way you can buy the goods and services you need. In riding the wave of minimalism, many people are embracing digital and sharing economies to avoid ownership and debt. As a result, you can skip the high cost of a taxi and opt for a cheaper Uber or you can rent a car outright for just a couple of hours with Car2Go.
Peer-to-peer lending, trading communities, and the second hand economy are booming, and it’s about time you take advantage of it. Rather than sink a lot of money into an appliance or vehicle you’ll use infrequently, see what alternatives to outright ownership are available. And just like dad used to haggle on the price of his tune up at the mechanic’s, you too can unleash your inner negotiator to get the best bang for your buck.
Dads are notorious for their aphorisms, jokes, and puns, but beyond pithy sayings, he’s a gold mine of practical advice. If these tips and techniques aren’t enough to get your finances into shape, call up dad and treat him to brunch. He’ll be more than willing to share his best advice over a plate of waffles.