money When you’re studying, all you can think about is graduating, getting a job and earning your first paycheque. The thought of being able to earn and spend your own money is thrilling. But it’s important to realise that earning money doesn’t mean spending all of it. You need to start thinking very seriously about saving money and making smart financial decisions. Recent research has shown that a massive 86% of South Africans are in debt. The money you earn in your twenties, and what you choose to do with it, is far more valuable than your salary at other parts of your life. This is why it’s important to understand money now. Here are a couple of money lessons you should learn while you’re young. 1. Spending too much on cars and cellphones Yes, flashy cars and the latest cellphones are nice to have. But they aren’t necessary. They are depreciating assets which lose value soon after you buy them. Rather, drive one of the many affordable pre owned cars available and find a good deal on an older cell phone. You might not look as trendy as your friends but you’ll have more in the bank. And that’s far more important. 2. Not buying a home This is a controversial topic as there are many different opinions. But there are certain times when it is better to own a home than rent a property. This depends on the market and the specific financial situation at the time, so don’t think this is always an easy choice. If you buy a home before you’re financially ready to do it, it will be a massive mistake. But once you’re in a steady job, earning a good salary and financially stable, it often makes sense. And buying your first home while you’re young will ensure it is paid off long before you retire. 3. Not saving for your future You might think you’re too young to be concerned about saving for your retirement. But the reality is, you’re never too young to start. Thanks to the magic of compound interest, money saved in your twenties will have many years to grow, making it the most valuable money you will save in your life. Statistics show that a mere fraction of South Africans can afford to retire comfortably. You need to start saving for retirement from your first paycheque. It is recommended you save at least 10% of every salary into a retirement account. This might seem impossible, but the sooner you start, the more natural it will become. Soon you’ll be saving 15% of your salary each month and it won’t be a stretch at all. Remember, when you change jobs in future, don’t touch this money. You should never dip into your retirement savings as you’ll never be able to replace the funds. Start making smart decisions about money today and your future self will thank you. You can’t put a price on peace of mind. Image: Pexels