Staying Financially Secure and Safe When Venturing Out on Your Own
Written by Christopher Haymon
Moving out for the first time often comes with many different emotions. You may be excited to start the next chapter of your new life and embrace your newfound independence, yet nervous about the uncertainty that lies ahead and sad to leave some of the people you care most about.
Amid these emotions, it’s easy to spend money too eagerly, and as a young person, it’s easy to underestimate the importance of taking safety precautions. That’s why we’ve put together a list of tips that can help keep you financially secure and safe as you set out on your own.
Start Budgeting Immediately
The best time to financially prepare for moving out is before you actually move. Find someone who has experience in budgeting (e.g., a parent, teacher, mentor), and develop a realistic budget for your new life. On the most basic level, this will require you to factor in your income and expenses, as well as organize your priorities.
Establishing solid budgeting skills before you move out will make things much easier when you’re living on your own. However, if you move out before you’ve properly prepared, you can still get ahead by starting as soon as possible.
Explore Life Insurance
One thing to consider when you’re making a budget is life insurance. While it’s an added cost, life insurance leaves a safety net for your family if you were to pass away unexpectedly. At the very least, it can provide money for medical bills and funeral expenses. It’s important, however, to choose a policy that fits your current circumstances and lifestyle. For instance, a 20-year term life insurance policy can be the best option if you have children, if you’re the family’s sole “breadwinner,” if you’re on a strict budget, or if you’re in debt. Use an online rate calculator to help you get a feel for how much you’ll spend on monthly premiums.
Always Save Something
Another important thing to keep in mind when you’re preparing to move out is that saving money is always a good thing. As you’re creating your budget, leave room to save — even if it seems a small amount. If nothing else, you will establish a habit of saving, and as you make more money, your savings will increase. Savings can come in handy in countless ways down the road, from job loss to emergency home repairs to a child’s college fund.
Opt for Credit Over Debit
Using credit cards comes with its disadvantages, but they’re often safer to use than debit cards, particularly with the prevalence of identity theft and fraud. Debit cards are connected to your bank account, so if someone steals your information, they can empty that account. Your credit card can be compromised as well, but it’s much faster to get a credit card company to cancel unauthorized charges than it is to wait for your bank to replace the lost funds in your account.
Whether you use a credit or debit card (or both), however, be sure to notify your card company or bank immediately if you realize it is lost or stolen. That way, you may be able to prevent — or at least limit — the number of fraudulent charges.
Live Somewhere Safe
Along with getting your finances in order, it’s essential to ensure your safety. This means choosing a home in a safe neighborhood. Research neighborhood crime rates and talk with locals to find out whether a certain neighborhood is safe. Also, be sure the home itself has adequate security (e.g., security system, stable doors, and windows, good locks).
If you’re moving out of your home for the first time, congratulations on the start of your next chapter! To put yourself in a position to stay financially secure and safe, be sure to start practicing your budgeting skills early on, and look into your life insurance options. Also, remember to establish a habit of saving, use credit cards when possible, and find a secure home in a safe neighborhood. Most importantly, don’t hesitate to seek further advice from people who have been through this experience before.
Photo Credit: Pexels
References:
http://pocketsmart.org/financial_management/save/
https://www.lifelock.com/learn-credit-finance-what-to-do-if-you-lose-a-credit-card.html
https://www.aba.com/advocacy/community-programs/consumer-resources/manage-your-money/7-tips-for-good-saving-habits
https://www.lifelock.com/learn-credit-finance-what-to-do-if-you-lose-a-credit-card.html
https://blog.mint.com/how-to/how-make-budget-living-alone/
https://millennialmoneyman.com/im-becoming-wealthy-because-i-have-mentors/
https://www.safewise.com/blog/10-simple-ways-to-secure-your-new-home/
