Financial Mistakes: Lessons to Teach Students Before They Start Earning

Hey Seedly fam,

I have been there, a time when I was broke. Unhappy. Empty.

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So here's my thoughts on helping fellow Gen Zs, Alphas etc, the next generation do better in their financial management.

Here are 5 simple key lessons to impart before they start earning full-time.

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📌 Mistake #1: Not Budgeting or Tracking Expenses

Lesson: Teach students to create a simple budget using apps like Seedly or You Need a Budget (YNAB).

Knowing where their money goes helps prevent unnecessary spending.

📌 Mistake #2: Overspending on Wants Instead of Needs

Lesson: Help students differentiate between essential expenses (rent, food, transport) and discretionary spending (shopping, entertainment).

The 50/30/20 rule (50% needs, 30% wants, 20% savings) is a good guideline.

If you want to be _more _aggressive, you can consider 40/30/20/10 rule (40% needs, 30% investment, 20% savings/cpf, 10% Insurance)

📌 Mistake #3: Ignoring the Power of Saving & Investing Early

Lesson: Show students how compound interest works! Even small savings grow exponentially over time.

If necessary, encourage them to start with robo-advisors or low-risk investments like Singapore Savings Bonds (SSBs).

📌 Mistake #4: Relying on Credit Without Understanding Debt

Lesson: Credit cards can be useful, but only if managed well.

Teach them to pay their bills in full every month to avoid high-interest debt.

📌 Mistake #5: Not Building an Emergency Fund

Lesson: Life is unpredictable! Encourage students to set aside at least 3-6 months’ worth of expenses for emergencies.

Leverage the existing savings account like Singlife or Chocolate Finance (interests better than the banks as of 3rd March 2025)

Financial Hacks for Students:

✅ Use student discounts & cashback apps for daily savings.

"Take care of the cents and dollars will take care of themselves!" #selfquote #asianamos

✅ Start a side hustle or part-time job to gain financial independence. It helps to create another stream of income!

✅ Learn basic investing early to build wealth over time.

✅ Follow personal finance blogs (like Seedly and others) to stay informed !

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Final Thought:

Financial literacy is the key to financial freedom.

The earlier students learn these lessons, the better their financial future will be!