1-Sentence-Summary: Get A Financial Life shows those that are new to managing money how to do it confidently by explaining everything from debt and savings to insurance and investing.
Read in: 4 minutes
Favorite quote from the author:
Turning 18 and graduating from being a kid is a lot of fun. Suddenly, you’re completely in charge of your life. You can go to college or live halfway around the world.
You even get to start doing those things that your parents would never let you do as a child.
But no matter what you choose to do with your life as an adult, there’s one thing you can’t avoid, and that’s money. Unfortunately, you probably haven’t had a great education about the subject so far in life.
Between your broke parents who didn’t have a clue and that high school financial literacy professor that only taught so they could coach the football team, good financial advice has been scarce. Until now.
That’s where Beth Kobliner’s Get a Financial Life: Personal Finance in Your Twenties and Thirties comes in. It will show you the ropes of this often confusing and overwhelming necessity of being an adult. You’ll discover some neat tips and tricks to make the most of your financial situation so you can reach your dreams and thrive.
Here are 3 of the best lessons I’ve learned from this book:
- To reach your dreams you must find out how much money they will cost then look at your finances to determine how to make them happen.
- Credit card debt is expensive and can prevent you from living the life you want, so get rid of it immediately.
- Insurance looks expensive, but that’s probably only because you don’t understand how much you need or where to get a good deal.
Are you ready to get your financial life together? Let’s get right to it and find out how!
Lesson 1: Determine how much your dreams will cost then adjust your finances accordingly.
It’s easy to make excuses for not dealing with money well. Just look at the global economy with all of its ups and downs! And let’s not even get into how awful the government is at managing funds.
None of these intimidating facts means that you have to be financially inept like everyone around you. All you need to do is start small today by analyzing how much money you need to reach your dreams.
If you want a new car, for example, you’ve got to know the price and plan your efforts accordingly. Say you’re eyeing something that’s $20,000. Paying cash is best, but if you can’t do that you’ll need about 20% down, which, in this case, would be $4,000.
That might sound like a lot but if you make a solid plan to get there, and prepare to make payments if you go that route, you’ll have your new car in no time.
The first step is to examine how much you usually spend. Try writing down all expenses for a month, then review the numbers to see where you can save money.
Or even better, think of ways that you can start earning more like changing jobs or starting an online business.
Lesson 2: Get rid of credit card debt as fast as possible, it’s expensive and holds you back from living your best life.
When I began my financial life as an adult and got my first credit card, I promised myself I would never pay interest. That was a decade ago, and I’ve kept that pledge. I’ve also never missed a payment and my credit score is over 800.
I don’t want to say this to brag but more to show you what’s possible if you start smart. Never getting into credit card debt in the first place is the best deterrent against expensive interest fees. It frees you from the mental burden of financial bondage.
Imagine you’ve racked up $3,500 in credit card debt with an interest rate of 17% and were only making minimum payments. This awful situation keeps you stuck making payments until you’re 65! And the interest alone will cost you $7,662!
If you’re already in that trap, that’s okay, there is hope. Start by talking with your lenders to see if they’ll give you a better interest rate or monthly payments.
A credit counselor might help also but go for a non-profit one if possible. They can help you negotiate with lenders to get a better deal.
It’s also a good idea to use savings to pay down debt because you can’t out-invest your credit card interest rates. I personally recommend Dave Ramsey’s method in The Total Money Makeover.
Lesson 3: Find out where to get a good deal on insurance and how much you need to avoid overspending.
If you’re just getting started out with money, insurance may seem like an overwhelming thing to think about. I remember when I first realized I had to pay for car and health insurance it felt like a waste of money because I wasn’t getting anything tangible out of it!
Whatever way you look at it, insurance is necessary to thrive as an adult. The difficulty is, if you don’t know where to go to find a good policy, you’re going to end up overspending!
In researching the situation of one young man, it was discovered that he had the option of spending anywhere from $808 to $3,441 for the same car insurance policy!
Start by looking at multiple companies to get quotes. You can ask family and friends who they use to find a local agent with good prices. I did this and my car insurance is only around $80 a month for two cars. And my health insurance is now just $62 monthly for five people!
It’s also vital that you know how much insurance you need for each type. If you have a good agent, they will explain it all to you to help you decide. It pays to do your research here to determine what’s normal and what you get with different plans.
You also want to check that you’re not already covered for certain things. When renting a car, for example, you might buy collision insurance when your insurance plan or credit card already covers this.
Get A Financial Life Review
I honestly thought I’d like Get A Financial Life better than I actually did. All of the advice seemed really outdated and then I found out that it was published in 1996 and it all made sense! I can’t fault the author on that point though, and also because I think I’m past many of these beginner-level financial tips.
Who would I recommend the Get A Financial Life summary to?
The 23-year-old that’s never been able to keep money in the bank, the 55-year-old who needs better credit to get a loan, and anyone that’s sick and tired of stressing so much about money issues.