Hello, my loves welcome back to Lavendaire today.
I'm sharing a 10 of money lessons that I wish I knew earlier.
And I'd like to thank Coinbase for sponsoring segments of this video.
So these are all money lessons that I wish I knew
when I was in college or my early twenties,
just so I could take advantage of these tips.
So if you're young and you want to be a little more financially savvy,
listen on.
The first money lesson that I wish I knew earlier is to understand inflation.
So inflation is the decreasing value or purchasing power of any given
currency over time.
What that means is, in general,
the price of everything is going up and the value of
your dollar or whatever currency you have
is going down over time.
I know at least for the US government,
the government targets around a two to three percent inflation per year.
Meaning they're planning for inflation to happen.
They want a healthy level of inflation.
It's all about macro economics
and the government trying to regulate
a healthy level of growth for the economy,
but just know that inflation is expected.
It's going to happen.
Knowing that your cash is devaluing over time is really important
because it means that
you can't just let your money sit in the bank.
I wish I knew earlier that if you left your money sitting in the bank,
you're losing money because the value is going down.
So you're supposed to do things to grow your money
at the same rates or higher rates ideally
then inflation so that the value is keeping up with inflation.
So once you've saved up a good amount of money in your bank
know that the money that sits in the bank
is devaluing over time.
So if you have any extra, you can use that money to invest
and grow it in other ways.
A good rule of thumb for knowing how much cash
you should keep in the bank at a time is
to calculate your average monthly expenses.
Then depending on your level of risk tolerance,
whether you are a risky person
or you like to be very safe,
you can have between three to six months worth of expenses in your bank.
If you're super safe,
maybe a years worth of expenses in your bank
before you have like extra money to invest.
Money lesson number two:
know the difference between good debt and bad debt.
So I think a lot of us are taught that debt is bad.
"Don't owe people money"
because we've seen so many of these horror stories where
people are in debt
and it just spirals into more and more debt,
and they're never able to pay it off.
But there is a difference between good debt and bad debt.
So good debt is when you borrow money
for the purpose of increasing your net worth
or having some future value.
For example, taking out a home mortgage
or a student loan.
It's about using leverage to your advantage,
which is a really smart thing to do in the finance world.
Even though a business might have enough money to pay for something
it's much financially smarter to borrow that money from a bank
and then have extra cash to do something else.
So people do this all the time.
It's called leverage.
I also didn't realize that it actually helps boost your credit score.
If you have some sort of healthy debt and you're making, you know,
full payments toward that every month,
the reason is when you have debt,
like say a student loan and you pay for it in full,
it proves to those credit people that you are trustworthy
and that you're paying something.
If you don't have any debt or any loans
your credit score isn't as high because you don't,
you're not showing them that you're borrowing and paying something back.
Bad debt on the other hand is when you borrow money to purchase
something that doesn't hold its value,
like the value just depreciates either immediately or over time,
for example, purchasing everyday necessities like food clothes,
everyday things.
Usually once we purchase them,
we can't resell them for the same price or even higher price like it's used.
It's done.
And this translates to what a lot of people do with credit card debt.
Credit card debt is the worst kind of debts.
I want you guys to know that too,
because with credit cards,
it's so easy to just pay the minimum
and then have a balance on your credit card.
But what they're doing is they're making money on the interest
that they're charging you every month.
And the interest for credit cards is super high.
The average is about sixteen percent.
So essentially with credit card debt,
you're paying these banks extra money
on top of the money you already owe them.
And if you don't pay that full amount, the next month,
it just grows and grows and grows to the point where
you were owing them more money in interest
than what you originally owed them
from your beginning balance.
So this is just a reminder to pay your credit card balances in full each month
so that you don't owe the banks anything.
To be honest,
the banks want you to just pay the minimum.
They make it so easy to pay just the minimum
because they want you to owe them more and more money.
That's how they make more money.
But if you want to be smart, pay everything in full every month,
Money lesson number three: learn about crypto.
I'm sure you've heard about cryptocurrency.
It's becoming more and more mainstream, more and more people are aware of it.
More and more people are learning about it.
But how deep does your knowledge with crypto really go?
Do you understand the different cryptocurrencies, what they are,
what they're trying to achieve, what blockchain is and how it works.
These are things that, you know, when I heard of crypto in 2018,
I kind of loosely learned about the surface level,
but I didn't get deep until I think beginning of this year,
it was when I really started getting deep within crypto
and just taking it more seriously,
because I think it truly is the future that
we are moving towards the future of technology,
the future of our money.
And that is huge because one day everyone will be using it.
It will be the thing and you don't want to get left behind.
You don't want to be the last one to know.
So when there are trends like this huge world, changing trends,
take some time to learn it, understand it.
And if you want,
you can start to invest in it.
At this point,
I want to thank Coinbase for sponsoring this segment of the video.
If you want to get into crypto, you need to check out Coinbase.
Coinbase is the primary platform for buying, selling, earning,
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I've been using Coinbase since 2018.
After my brother introduced me to the app.
I like how user-friendly the platform is
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by offering rewards for watching their informational videos.
They're fun videos sparked my interest in learning more about different cryptocurrencies.
And it's really exciting to hear about the new platforms that are being developed.
I love learning about what the future may hold.
I currently use Coinbase to track my favorite cryptocurrencies,
buy and sell and continue learning about crypto in general.
If you want to get started,
check out Coinbase to learn more about
what you can do with cryptocurrency
like buying, selling, and earning crypto
Coinbase is giving away $10 worth of Bitcoin to viewers
who sign up using my code: LAVENDAIRE
The link is down below.
You don't need to buy anything.
All you have to do is sign up on coinbase.com and verify your ID.
Thanks again to Coinbase for sponsoring this part of the video.
Money lesson number four: start investing early.
This is something that I wish I knew in high school.
I wish I started investing my money,
even if it's like a little bit in high school,
because I could understand compound interest.
I could understand how investing helps you grow your money.
Because once I learned about that,
I was like, wow, this is magical.
Like I wish I knew this earlier.
So we didn't have TikToK when I was in high school.
I know a lot of young people are getting into investing earlier,
which I think is great.
So learn what compound interest means,
understand how the stock market works.
Don't be intimidated by the stock market.
Don't be intimidated by just all the investment options out there.
No matter what age you are.
I don't think it's too early to learn.
It's not too early to learn about stocks, bonds,
investment accounts, investing in real estate.
Like whatever you're curious about,
just learn about it.
You have Google because it will help you in the long-term.
Investing and compound interest is all about using time to your advantage.
And there's no one that has more time than young people.
So if you're a young, know that time is on your side.
If you start now,
the money will like grow and compound into something really big and
really major.
Even if you start from a small amount,
I've made a couple videos on investing in the past.
So I'll just link those here in,
down below so that you can get
the full version of how, why,
and when to start investing.
Money lesson number five:
become aware of your money mindsets and any limiting beliefs around money.
So you might not be aware of this,
but you probably have some preconceptions, assumptions
and limiting beliefs around money based on how you grew up
your environments or the media that you were exposed to.
Have you ever told yourself, "oh, I can't do that".
"Oh, they have this because they're rich" or "I'm too young to start investing".
All of these are just beliefs in your mind.
And they are beliefs that once held, you think they are true.
And so you live according to them.
It's so important to recognize that you probably do have some limiting beliefs
and start to ask yourself, "okay, where do these beliefs come from?"
And "can I release these beliefs?"
Because they're not helping me.
You know, it's not helping yourself to hold yourself back.
A lot of people have a limiting belief around
how much money they think they can make
because everyone in their family only makes this range of money.
They don't believe it's possible for them to make more.
They believe, oh, everyone just makes
this range of money.
And so they hold themselves back.
They prevent themselves for achieving their fullest potential
because in their mind, their box
and the ceiling only goes up to here.
When in reality, there is no ceiling.
It's all in your mind.
Let go of those assumptions.
Let go of those old beliefs,
especially if they are not serving you.
So much of success is really breaking down those barriers mentally
so that you can allow yourself a more abundant life,
allow yourself more possibility and opportunity in the world.
Money lesson number six:
don't be afraid to talk to people about money, speak up and ask questions.
That's the only way you're going to compare information and learn.
So a lot of people are scared to talk about money.
I get it, me too sometimes. I think in Western culture,
we're taught that talking about money is taboo,
but I've found, especially for women.
We shy away from talking about money.
I see like my male friends talk about money and business and these topics
much more often than I see my female friends.
And it shouldn't be that way.
Money shouldn't be a taboo topic
because we should be communicating, sharing information and sharing knowledge
so that we all can learn so that we all can grow together.
Talking about money and sharing information can really help you
because knowledge is power.
So whether you're talking about investments with your friends,
or you're talking about money with people in your industry,
because you want to understand what things are worth,
what people's salaries are, this or that,
that information can only empower you to know your own worth
so that you're not playing guessing games.
Money lesson number seven:
Think long-term not short-term with your spending.
So I know once you start making money,
it's really tempting to want to splurge on trendy luxury pieces
or dining at expensive restaurants
and just upgrade your lifestyle a little bit
because yeah, it's fun.
But consider that some things are short-term and fleeting
while other things are
better investments for the long-term.
So instead of spending a hundred dollars on a fancy meal for yourself,
where else can you put that a hundred dollars?
Can you put it towards like equipment that you actually need for your job,
or a course that will enhance you and give you more skills,
think about the value of your dollar
and spending it in
ways that will help you in the longterm
and especially watch out for the purchases that you're making
just to impress others,
or just to keep up with the Joneses.
It's not worth it.
This leads me into the next lesson,
which is invest your money in ways that will help you grow.
So I am a huge advocate for investing in yourself
and I don't want to cheap out on myself,
meaning if I want to take this course and it's expensive,
I'm going to do it because I know at the end of it,
I'm going to be a leveled up version of myself
because I'll have acquired new knowledge and skills.
And those things are really valuable to me.
I also don't cheap out on things that are essential to the quality
and the growth of my career.
So for example, software and equipment,
there are so many free tools for like graphic design or video editing.
But I truly believe in using like the high quality professional software,
because you gotta be a pro
you've got to be operating at the pro level
in order to create pro results.
You don't want to cheap out on that stuff and not learn,
not take the time to learn these more expensive programs,
because there is a difference in the quality that you put out.
So obviously there are times where you can get the budgets,
the cheaper version and create just as good quality of a result.
But, you know,
I'm all about just investing in the things that matter,
investing in the things that will help me grow.
And then I can be a little more frugal with the things that are not essential to
me and my future.
Lesson number nine is to sell your items and purchase secondhand.
So this is more of an environmental tip and reminder
that you don't have to buy everything new
and you don't have to throw your things away
because one man's trash is another man's treasure.
So first,
if you have anything and you want to make a little extra cash,
definitely utilize those apps where you can sell your items
or even donate your items.
I love donating everything that I can donate.
The other side of this is to purchase second hand.
So if there's an item that is expensive,
that you've been eyeing instead of trying to buy it brand new,
purchase it second hand, like you can get a lot of cameras,
secondhand that are in perfect condition.
Basically you can get designer bags.
I can hand there's so many things that you can buy second hand.
So just putting it on your radar
because overall it is better for the environment.
We don't have to be a one-time use society.
We don't have to generate this much trash, just keep it in mind.
And you can see your items in a different light.
You not only save money,
but you're also helping the environment.
And finally money lesson number ten: start planning for retirement
if you haven't started already.
So for most people, this means getting a retirement account, like a Roth IRA.
I recommend you look up the different types of IRAs
and you understand what they mean
and which one is the best for you.
I'm not here to give financial advice like that,
but it is important to start planning ahead.
I know if you're young, retirement sounds like forever away,
but you want to make sure that you are taking care of yourself
and that you protect yourself in the future
because you can't depend on social security.
You can't depend on the government to take care of you.
At that point,
you have to make sure that you've saved enough money by then to live
and retire comfortably and take inflation into account.
Because the amount that you need to live today
will be different when you're retired.
If you're an entrepreneur, or if you want to be entrepreneurial,
I highly recommend you start learning about the types of investments that you
can make that will give you a passive stream of income.
A popular example of this is to invest in rental properties that you can rent out
and people are paying you rent on a monthly basis.
If you have enough of those properties,
the passive income that you're making will be enough for you to live.
And that could be a great retirement plan.
So wherever you are in your journey start thinking about it now
and start planning ahead
for your retirement,
because it all matters.
You don't want to have lived life.
And then you're like, oh my god, it's too late.
I don't have time to save enough money.
And so you're forced to keep working.
That's not good.
The information is there.
The knowledge is out there for you guys to start learning
and grabbing these knowledge tid bits
so that you understand how to prepare yourself,
how to invest, how to create abundance in your life.
Now that we've made it here,
let me know down below which one of these tips was your favorite,
which one of these tips kind of like opened your mind a little bit,
because I'm curious which ones are new to you, which ones you already know.
If you have any questions or video requests also let me know down below,
because I'd love to make more videos to just help you
become better equipped at life in general.
And money is a big part of it.
I'm trying to build financial freedom. I know a lot of you out there are,
so let's do it together.
Sending you so much love,
and I will see you in the next one.
Bye.