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Various surveys over the past two years have shown that many of us Brits aren’t that great at handling our money. In fact, around half of UK adults are thought to be ‘living on a financial edge.’ For many, this is the result of being caught up in house price rises, the recession, or other issues out of individual control. But for a lot of us we probably could have done better with a little early help. If you could go back and have a word with your 18 year old self what financial tips would you pass on? We came up with these Top Ten but feel free to tell us yours in the comments section below:

parental advice

Tip 1: Start saving now

At 18 years old you feel like you’re never going to get old. The tender age of 30 seems like a very distant milestone and houses, kids and pensions are less important than parties and travel. However, the advantages of saving early are huge. The younger you are the more years you have for “compound interest” to work its magic. For example, if you’d saved just £2,000 – £5,000 a year from the ages of 18 – 28 (assuming you move from a part time job to full time), you’d have much more than £20,000 – £50,000 you’d expect by the end of the decade. You’ll have the interest on the interest on the interest, etc.

Tip 2: Retirement plan from your first job

Pensions aren’t sexy. However, they are necessary. And statistics show that most of us won’t have enough to live on when it comes to our golden years. Paying into a pension from the first employment contract will create a significant buffer for old age.

Tip 3: Learn how to budget

Again, there’s nothing cool about budgeting and learning to live on what you earn. However, budgeting is the one tool that can really open financial doors. Young people who learn early how to divide income into cash to spend and cash to save will be able to reach their financial goals far sooner than those who are still struggling to get control of their finances at 30.

Tip 4: Set financial goals

What many of us don’t realise when we leave school is how much our financial goals are tied into every other dream we have in life. If you dream of being a parent, you need to plan to have the money to fund a period of child rearing. If you want to have a second home somewhere hot and sunny, you need to start saving for this early. For those who dream of working freelance, a significant pool of savings is important while you get on your feet.

Tip 5: Get onto the housing ladder

We are increasingly becoming a society of renters because most potential first time buyers now simply can’t afford to buy. If you don’t already own a property, no doubt you wish you could go back at tell your 18 year old self to make it a priority. According to The Telegraph newspaper, the value of homes in the UK has soared by £1.412 trillion to £5.752 trillion over the past 10 years. That’s more than the GDP of France, Germany and Italy, combined. Those who got onto the property ladder early are now quids in.

Tip 6: Make sure you have a safety net

Life is very unpredictable and, at 18 years old, most of us still have a naively positive impression that everything will turn out ok. Of course, sadly that isn’t always the case. A financial safety net that provides a buffer for bad times and rainy days is something that provides protection well into adulthood, whenever that may occur…

Tip 7: Take out health insurance

We do still have a good, functioning NHS in the UK but the chances are that this may not be the case for that much longer. Those with longer term health insurance policies on which they have not claimed tend to be able to get better rates for the future. Plus, taking out health insurance when you’re young, fit and healthy is much cheaper than when life starts taking its toll on your body.

Tip 8: Get to grips with the taxman

This is particularly important if you’re planning to be self-employed at any point in your life. Starting out at 18 with a good understanding of how tax is paid, when and why should ensure that costly mistakes and over payments can be avoided.

Tip 9: Get into good habits, young

One tip that would have benefited many of us at the age of 18 would be to start getting into healthy financial habits right now. Over borrowing, reliance on credit cards, putting off deadlines and missing bill payments are bad habits that can have a big impact on financial future. Learning how to borrow well, repay quickly and make good choices about products such as personal loans is better done at a young age.

Tip 10: Enjoy your money

You can’t take it with you after all.

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