Finding a Reason to Save

The biggest obstacle many young adults face financially is apathy. The second might be ignorance. Managing our finances seems big & scary, and when it comes to saving & living within our means we just don’t wanna. Checking our balance online once a week is often the most we ever do when it comes to financial planning. We make our big purchases on payday, before we can whittle our income down with stupid stuff like paying our bills or filling our gas tanks. We’re certainly not immediately concerned about ever having the money for a wedding, a house, kids, retirement or anything else. In fact, we’re often operating on this vague assumption that by the time those Major Life Events come ‘round, we’ll be working glamorous jobs and making $80,000+ a year and those expenses won’t even dent our bank accounts.

We’re just not inspired to do anything with our money other than spend it. We want (multiple) beers after work every night, iPods, dinners out, new clothes, DVDs, the latest cell phones, video games…in fact, we’re pretty much still teenagers except for the beers part. Most of my friends weren’t paying any attention to their finances until all of the sudden they found themselves crossing over into their mid (or late!) twenties. Out of nowhere, we begin to wonder if we are doomed to live with roommates our whole lives, if we’ll ever have careers instead of jobs, if we’ll have nice weddings or just go visit a justice of the peace and have it over with, or if we’ll be able to retire comfortably- the list goes on and it’s different for everyone. Whatever your reasons, they’ll hit like a ton of bricks when the time comes.

But what do you do before the What-Ifs kick in and you start caring about your long-term financial situation? How do you get inspired to take control of your finances instead of just plucking along, paycheck to paycheck, heaving a big sigh of relief when you don’t get evicted and your cell phone’s still on? I believe the answer lies in finding short-term goals to work toward. Our attention spans are short, at 18-20 ish we don’t really NEED to start planning for weddingsbabieshousesretirement just yet (though we should)- but we might just get inspired to get our butts in gear for the more nearsighted goals.

So if you’re not quite old enough to care about the Real Grown Up Stuff You Have to Pay For, sit down and make a list of goals. They should be goals you could reach in a year (maybe less!). Here’s what a few of mine might have looked like when I was 19:

• My own room! (If you live at home, this might translate into getting an apartment with friends. If you’ve already got an apartment with friends, this might translate into getting your own place, or a place with fewer roommates.)
• A trip to ______ (Fill in the blank. I think I wanted to go to Africa when I was 19. Still do. Traveling abroad or cross country is perhaps one of the best goals for younger adults. We’ve got more freedom to roam and it’s lower cost goal with a short payoff. Perfect!)
• Paying off my car loan. (Some of you might have this one too. If you went to college, this might be a student loan instead. It might be both. Maybe you just want you’re a car in the first place!)
• A laptop! (I’ve got one now, I bought an iBook G4 from a friend for $500 when I was 22. But this item might be any other gadget- a GPS, an iPhone. Of course, this assumes you’ve got the willpower to not put such an item on credit.)

Write down your goals. Whether you’re 18 and you just want an iPhone or 28 and looking to buy a house. Write them down. Be detailed. Where is your apartment? When you get to Italy, what will you see? What will you do with your laptop when you get it? Where is the dining room in your house? Put your list somewhere you’ll see it every day (taped to your computer monitor is best). Definitely look at it when you check your account balances online. Are you treating your money in a way that brings you closer to your goals? Or are you just as far away from them as ever? When the disparity between your behavior and your greatest wants can no longer be denied, it is very difficult to not begin taking at least baby steps towards financial responsibility.

If you’re reading this blog you probably already care about your financial situation on some level, but all the blogs and tips in the world won’t help you unless the decision to take control of your finances is inspired by a personal goal you care deeply (dare I say viscerally) about reaching.