I have been teaching my university - going daughter about managing her money and saving and investing for the future because schools do a very poor job about increasing our children's financial IQ. Lately, I have also been giving her advice about spending her money in a practical manner. "Be careful how you spend your hard earned money", I tell her. Spend your hard earned money on practical, useful, and meaningful experiences rather than designer stuff that has no value. It has been a struggle convincing her to be practical about her spending habits. Here are a few things we have spoken about over the years.
Travel to Rekindle Personal Relationships: There may be no better way to spend your money than to use it to nurture personal relationships with the most significant people in your life. As time quickly passes, we sometimes forget how essential strong personal relationships are to our mental well-being. The older we get the more we need true friends and family to be regular parts of our lives
Your health is your life. Spend money on a personal trainer: Without good health all the success and affluence in the world is meaningless. Committing yourself to a regular exercise routine is one of the best ways to maintain the health of your body and mind. Sometimes it’s hard to tackle this endeavour on your own. Spending money on a knowledgeable personal trainer who can set you on the right course creates priceless results.
Invest in Real Estate at an Early Age: There is no better investment than real estate. First, buy your own home. Don’t rent. Real estate allows you to earn residual income, which gives you more options to become financially independent. Real estateteaches you negotiation skills, resiliency and patience.
Fix What Is Not Broken: Have you been ignoring that dripping water tap or screeching brakes? Sooner or later these small annoyances will wear down the reliability of the product and you will be left with a completely broken product instead of just a halfway broken one. Use your money wisely to fix and maintain your belongings.
Buy Meaningful Gifts for Key People in Your Life: One of the most rewarding acts in life is the act of giving; especially to those key people you truly care about the most. Spend a little money every now and then on a sensible gift for some of the key people in your life. Surprise them. It does not have to be their birthday or a holiday. Remember, there is no better gift than an unexpected gift. You will make them feel special. Spoil your parents...often (lol)
Pay Down Debt: If you have a great deal of high interest debt it would be foolish not to pay it down before you go off and splurge on additional purchases. There is nothing less practical than being a slave to your debt.