The earlier you start, the easier it will be to get ahead financially. Here are some recommendations for those in their early twenties.
Pay yourself first. Every time you get paid, put something aside in a savings or investment account. As a general rule, save 10% of your income. Even smaller amounts add up over time.
Watch your plastic. Credit cards are an expensive form of debt, and it’s easy to lose control of them. Try to pay your entire credit balance every month, even if it’s a stretch. If you’ve been carrying a balance, buy nothing more on credit until the balance is zero.
Keep a clean credit record. If you plan to own a home, buy a car, or start a business, you’re going to need squeaky-clean credit. Keep all of your financial obligations current, and never make a financial commitment that you can’t keep. If you fall behind on any obligation, talk to the creditor immediately to make alternative arrangements.
Make sure you have adequate medical coverage. You may not see a doctor even once this year. But if you do need medical care, it could be for something serious and expensive. Anything less than a good major medical policy could ruin you financially.
Watch your expenses. At this point in your career, you may not receive large or frequent pay raises, but you can achieve the same effect by cutting expenses. Shop before you buy. Very similar – and sometimes identical products – are sold at widely varying prices. Wise shopping can be the equivalent of having a good-paying second job.
For assistance with financial strategies suitable for your particular age and situation, give us a call.