Five Financial Foundations(FFF)
learn and grow your financial needs with the FFF
1. Emergency Fund
2. Get out of Debt
3. Pay cash for car
4. Pay cash for college
5. Build wealth and give
1.Set up a Emergency Fund
As a teenager you should save a $500 Emergency fund. You should use this emergency fund for surprise purchases like a new tire or a broken cell phone. You should save this fund as quickly as possible and keep it in the bank
As you get older you need to increase that fund into a full 3-6 months worth of expenses. This should be around 5,000 in a separate bank account.
2.Get out of DEBT
3.Pay cash for large purchases/cars
debt which will carry over into your adult life. Another thing that you should pay cash for is a car. Instead, you should use a sinking fund which will take longer than taking out a credit loan but in the end it will pay off by not having any debt carry over into your adult life.