Dear Upcoming Millionaire,

When you have money, it’s very tempting to spend it all in one place. Having the freedom that money gives you can sometimes cloud your judgment and if you get too carried away, you’ll end up burning a hole in your wallet. To help you with future financial endeavors, here’s some advice:

Open a bank account with your preferred bank and get started with a debit card. This can help you have more control over where you want your money to go. Online shopping is a great resource if you want to compare prices and use virtual coupons. The main downside is that it allows you to get reckless with your spending by not telling you how much money you have left in your account. Though with some self-discipline, you can spend less of your money on the things you want.

If you want to keep track of where your money is going, subscriptions are the enemy. If you have too many subscriptions, you could end up overdrafting your account. But if you really have to watch that new show that came out on your favorite streaming service, writing down the dates when your subscription renews on paper or in a notebook can help you avoid unexpected fees.

Making smart choices before you spend your money can also help you avoid impulse purchases. Think to yourself, “will I still want this in a few years?” because most impulse purchases are made in times of boredom and the action of spending money and receiving an item can sometimes feel rewarding. So to avoid this habit, think before you buy.

Another great way is to set up a savings account. Putting your money where it cannot be directly accessed can help you build interest in your savings and help you lose the temptation to spend your money. 

Lastly, by taking the time to plan out your recurring purchases, you’ll be able to manage your spending accordingly. Many coffee drinkers go to Starbucks each morning to get themselves a cup of coffee. On average, people order $5 worth of coffee from Starbucks to start their day. If this becomes a part of their daily routine, they will spend $1,825 on coffee annually. A way to work around this would be to find alternatives that can save money in the long run. Instead of Starbucks, make coffee at home. If you buy lots of food from delivery services, why not learn a new recipe and cook dinner at home?

As you can see, there is a multitude of ways to save money. As long as you have self-control and take the extra time to see if you can save a few bucks here and there, you can make the most of your earnings.

Sincerely,

Erin