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What Never to Do with Your Money, Especially When You Are Young

It feels great to flaunt your latest bag, watch and clothes from a designer. What could make you look more interesting than carrying your favorite latte from Starbucks, donning those new shoes?

I know that spending money and clicking pictures to boast about your wealth on Instagram feels good. But this doesn’t mean that it is the right way of doing things. You need to be more careful with your money, especially when you are young.

Here are a few things that you never do with your money, especially if you don’t want to regret your life’s decisions when you retire.

That latte is too expensive

Every traditional budgeting planner asks their clients to stay away from their $4 latte. Why? The answer is simple. Buying a latter each morning doesn’t make sense. If you are like most Americans you probably buy a latte costing $4. This means more than $100 spent just on buying a cup of coffee every month and over $1,200 in this pursuit in a year.

Think again. In a world where $100 could help you save, investment or even buy some essentials, would you really want to drink a coffee every day at the local Starbucks?

I am not suggesting you to not buy coffee at all. You can do that if you like but not every day. You can get a cheap but wonderful coffee maker. In fact, if you scour YouTube, you will even find great ways to make delicious coffee at home without a coffee maker. There is always a good alternative if you are ready to look for one.

The money you save can be used to buy organic food, paying off your debt or even be invested. You will be glad after a year because you would have gained a better degree of financial independence.

Never spend money on expensive gadgets

Gadgets come in only two categories- ones that are reasonably priced and work well and others that look great, work great and have a huge price tag. You already know which category of gadgets to avoid. Take this for example- if a $400 smartphone matches or beats your expectation, why should you waste your money in buying something that costs $1,000?

Ask yourself this question. Are you buying things because you need them or just because you want to show them off?

Most gadgets depreciate in value, just like your car which loses a majority of its value as soon as it moves out of the showroom. Gadgets lose their value sooner than the car, no matter what shape you keep them in. A newer, better model is always in the making and chances of you changing your gadget within one year are very high.

Unless $1,000 is less than 1% of your income, what is the point is buying a gadget that costs so much? Yes, you can buy expensive gadgets if they help you earn some money. For photographers, buying expensive cameras and lenses makes sense because it helps them earn.

You are young and still have time to save early and save more. Use time to your advantage.