At the age of 19: At the beginning of this period, you will be starting your junior years at university. You already have a career path, either because you chose it or because different circumstances led you to it (it’d better be the first one!). You are tracing a path on which you will walk till the end.
- And, what about your financial development? Up to this point you have walked at the same pace as your current friends. Until now you have all been very similar. From now on, you can start telling the differences among you. The first one will be education. Some of you will get an Associate´s degree or a Bachelor´s degree, some will later apply for an Advanced academic degree, and others will have to face life with the limited resources that high school offered them. Your quality of life will be supported by the preparation achieved at this stage. With university or without, you will have to make an effort to stay within the limited numbers of self privileged ones that will always have a comfortable quality of life. Undoubtedly, a university degree will make the journey easier.
Your Financial Education
If finance is not your cup of tea, I regret to inform you that the learning process through this period might be a little tedious; it can be even very tedious if you are not mentally prepared. During this stage, you should start getting some information on personal financial planning, basic financial planning, and acquisition of essential goods, insurance, investments, retirement, estate and taxes. I know this is not a particularly entertaining topic. Finance, as a whole isn’t though I’ve tried my best to try to make this easier. I hope that I have accomplished my mission. This book is a good start; but as you go through it, you will notice that the topics are more complex than you expected, and you will realize that this book is just a little aperitif for you to taste and you will be drawn to consulting more advanced texts. This requires some effort, which will be rewarded when you achieve an efficient administration of your income. It may be a little tedious, my friend, but you have no
choice. Either you learn how to manage your personal finance or you will spend your entire life working for others, since most of your savings will wind up in the bank account of those who have learned to manage their financial life.
-So, let’s get down to business.
I encourage you to continue reading. If you find this boring, it doesn’t matter, persist. If it’s still too much for you, you will have to stop learning with this book. Research! Find another way to make this learning pleasant (by the way, when you do, let me know. In the first pages you will find my email address). If books are not for you, then take some courses, attend seminars or hire an advisor and learn from him/her. However, whatever you do, do not remain financially ignorant. I repeat: if you want to succeed in your financial life, you have no other choice. If you don’t get to have any financial knowledge, then give up. Yes, my friend, give up being part of the group of the self-privileged ones.
How to get ready to ask for a loan in order to purchase your first vehicle?
For starters, you must have cash for a down payment. It should be between 10 and 30% of the total value of the car you chose. The rest of the money will be loaned by a bank or any financial entity specialized in this kind of transaction. You will have to do some research until you find the financial entity that offer you better terms. Since you haven’t had any experience with loans, let’s start from the beginning. The first thing you need to consider is your income. You will have to show the bank that you have enough money to meet monthly payments. If you are an employee, and you have a salary that satisfies the requirements of the lending entity, a letter from your company in which your annual salary is outlined, your balance sheet, documents, forms with the information required (identification, blood type, genetic map with full names of your entire chromosomes... You understand!), you won’t have any major difficulty getting a loan. If you work independently and you have no regular income from a company, you will need a letter signed by an accountant in which he/she certifies your income. You may also want to include a bank account statement in which your recent transactions are shown. You will have to have planned the loan at least six months in advance, so that it shows adequate financial statements. If you consider that your current income is not good enough to satisfy the bank criteria, you can add a document that foresees your future income. By doing this, you will show that you have a well-structured plan and you will give the impression that you are a person who is in control of his/her finance. These are important aspects for the bank. If you practice what was explained in the previous paragraph, you can always be sure that you will count on enough resources to pay installments. It is very likely that the bank accepts your request since this is guaranteed by the vehicle itself, but if you can’t meet the monthly installments, you will be in trouble. You will lose the vehicle, your money and most importantly, YOUR CREDIT RATING. I don’t mean just your current loan, but your good name, your financial trustworthiness, the value you have as a responsible person in society (mainly banking). You could be placed on the black list as an untrustworthy person.
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