How much money is enough money
There is a simple overall rule for managing your finances: you have to earn more than you spend. When living on your own you have to have enough money to pay rent and dues, electricity and water bills and insurance, phone and web access. Daily spending on things like food and public transport can soon become too much if you are not aware how much you have to spend for the day. Do I buy lunch at a restaurant or can I cook at home and bring lunch with me to work? Do I buy goods or drinks often or could I be more selective on those and save for buying something more valuable and long lasting. Do I want to save my money or invest it into safe investments, or would I rather have a good night out and spend it all at once?
There is a simple overall rule for managing your finances: you have to earn more than you spend. When living on your own you have to have enough money to pay rent and dues, electricity and water bills and insurance, phone and web access. Daily spending on things like food and public transport can soon become too much if you are not aware how much you have to spend for the day. Do I buy lunch at a restaurant or can I cook at home and bring lunch with me to work? Do I buy goods or drinks often or could I be more selective on those and save for buying something more valuable and long lasting. Do I want to save my money or invest it into safe investments, or would I rather have a good night out and spend it all at once?
Using money is all about choices: 1. What is necessary to buy? 2. What is not essential but would make me really happy? and 3. What do I want to buy but really don’t need? Plan a budget outlining how to use the money you have. Write down how much you earn and what your incomes are, and compare that to a list of your monthly or weekly spendings. Check your calculation regularly, and always review at the time when there is a change in your financial situation, for example when you change a job or a billing period will change. The Penno Application (in Finnish) can help to manage your budget on a mobile phone. Taking care of your finances is not always easy - luckily you don’t have to do it all alone.
Short-term loans (Finnish: pikavippi), part payments and overall living in debt feel like an easy way out at first, but any money that has been loaned must always be paid back. With short-term loans, the interest rate is often very high. Always keep track on where you have debts and how much. A seemingly cheap monthly installment may take a slice of your budget for up to two consecutive years. Difficulties paying back will quickly lead to having one's credit rating downgraded, which will make life difficult for a long time.
Short-term loans (Finnish: pikavippi), part payments and overall living in debt feel like an easy way out at first, but any money that has been loaned must always be paid back. With short-term loans, the interest rate is often very high. Always keep track on where you have debts and how much. A seemingly cheap monthly installment may take a slice of your budget for up to two consecutive years. Difficulties paying back will quickly lead to having one's credit rating downgraded, which will make life difficult for a long time.
Help with managing personal financies from The Finnish Youth Housing Association NAL, Takuusäätiö - Garantee Foundation and the Finnish home economics association: The Martha Organization. Kun koulu loppuu (When school ends) -site and Youtube channel (in Finnish) can also prove to be helpful to check out.
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