Money Management for Men

There’s pretty much only 2 thoughts that primarily occupy a dude’s mind. One is obvious, and the other is money. Think about it–you work, hustle, and strive for one or the other or both. Listen to what Mr. West says: “I don’t know what’s better, getting laid or getting paid. All I know is if I’m getting one the other’s getting away.” With that said, let’s focus on proper money management.

I’m sure you’ve heard the saying “you’re either broke or balling by the age of 30.” For some of us, that number is in the vicinity. Following these simple rules will help you in the pockets, which in turn will help you get in their pants.

1. Absolutely pay off your credit card debt. Most people think interest is a bad term, but that’s only when it works against you–as in credit card debt. Every card that you have a balance on, you should tear it up right now. If you have multiple balances, consolidate them into one lower rate and formulate a plan to pay it off. It’s imperative you don’t add on top of what you already owe. Say you find an awesome deal on a jacket for 50% off retail. Guess what? If you buy it on credit and don’t pay off your balance monthly, you’re probably paying more than retail for it. Who wants to pay 150% of retail for something? If suckers pay retail, what do you call people who pay over retail? Yeah that’s not looking like a deal anymore. Ask yourself do you need it or do you want it? Usually it’s the latter.

2. Create a budget and learn accounting terms. Yes, it may sound mundane and boring–but it’s imperative in order to be fiscally responsible. As Big Boi would say “it’s not what you make, but how much you spent.” Generally expenses should fall under 2 categories: fixed [rent/mortgage, utilities, car] and variable [travel, entertainment, clothes]. You know how much money you make, so you should also know how much money you spend. You should strive to maximize your assets and minimize your liabilities.

3. Be frugal but don’t be cheap. There’s a thin line that separates the two, but once you establish the difference you can be in financial harmony. Cheap is like buying a cheap set of golf clubs because they were inexpensive. Later on they would break, and now you want to buy quality clubs because the cheap clubs broke on you. If you would’ve bought the quality clubs initially, you actually would’ve saved money in the long run. In this example, being cheap actually costs more.

4. Cut the fat. My coworker, let’s call him Tim because that’s his name, recently got rid of his car because it wasn’t beneficial to him. Tim drove it sporadically, and when he did drive it, it just gave him problems. He lives in the city so he utilizes public transportation. Tim has enough friends if he needs to go anywhere out of the city, they’ll just swoop him up. This scenario is a little more extreme, so I’ll share a personal example. I recently removed the internet connection from my cell phone, which reduced my bill by $25 per month. I have broadband connection at home and a T1 connection at work, so do I really need 14.4 Mbps speed on a phone that I only use to check box scores? Someone sold a life insurance policy to you? If you have no kids you don’t need it. Your work should cover whatever insurance you should require.

5. Don’t buy jewelry. The only jewelry a guy should rock is a timepiece. Unless you’re married, then a wedding band is appropriate too. Regarding your significant other, if she’s the One then you only need to buy her that rock when it’s time. For Christmas, Valentine’s or her birthday, don’t even think about getting her anything shiny, since once you get to that threshold you can’t just follow it up with a sweater or something. On your next movie night, watch Blood Diamond and hopefully that will change her outlook on the ice.

photography by elle_rigby

6. Learn how to cook. Or even just learn how to prepare food. Lunch generally consists of a sandwich or a salad, both of which a 5^th grader can make. When you cook, you know what goes in your food, and you can have leftovers for the following day’s lunch. Is it really important to go have lunch with your coworkers? You already see them more than your significant other, family and friends, so an hour a day away won’t hurt. That $40 rib eye that you bought at a restaurant would cost less than $10 had you prepared it yourself. That $10 salad for lunch probably had $2 worth of ingredients. Plus chicks dig dudes who can cook.

7. Have a minimum of 6 months of living expenses saved. Typically, you should have the following asset accounts:

1. Checking account
2. Savings account
3. Retirement account
4. Brokerage account

Do yourself a favor and close your brick and mortar savings account and switch it to an E-Trade or ING account, which rates are over 5% now. Notice I left out a Money Market account, since current savings rates blur the difference between the two while being more flexible. If your fixed expenses are say $2500 a month, you should have at least $15K in your savings account. If you do, congrats and I apologize for wasting your time with this article. If not, you need to build up your cash reserves. Regarding your retirement account, you should be aggressive as possible, since you’re not going to cash it out anytime soon. In this example, compound interest is your best friend. Also, open up a brokerage account even if you don’t know anything about stocks. People who generally talk about stocks generally don’t know anything about them. If I had its stock for every time someone mentioned Sirius to me, I’d be poorer. For starters, just buy an index of say the Russell 2000 or S&P500 and reinvest the dividends and don’t worry about individual stocks, as you are not Warren Buffett.

8. Have a hustle. Most people who are balling have multiple revenue streams. Rick Ross isn’t the only one who is hustling everyday. You can’t just rely on your W-2 income, since you’re only netting 70 cents on the dollar. Unless you’re a doctor or have an Ivy League MBA, additional income wouldn’t hurt. Getting an additional degree or certification can also be considered a hustle. Granted this is probably the most difficult to achieve, so there might be trial and error involved. Just think about what you enjoy doing and how to profit off of it.

Understand this is a gradual process and will not happen overnight. I’m still personally trying to follow a few of these rules. But these are basic guidelines that can help you on your path to financial freedom. No one likes the dreaded feeling of living from paycheck to paycheck, so regardless of how much you currently earn, you don’t need to feel that way. Being fiscally responsible in your 20’s establishes a foundation of growth and a proper money mindset for down the road.

Remember the saying: If your outflows exceed your inflows, then your upkeep will be your downfall.