There’s no doubt that your 20’s is a very important stage of your life. There’s a nervous but exhilarating feeling about becoming an adult, moving out of home, and being financially self-reliant. Whether or not you started a career, a university degree, or spent time traveling to other countries and gaining life experience, your 20’s is a valuable decade from both a personal and financial viewpoint. Regardless of what path you go with, the one constant that will always remain in your life is money.
The reality of the matter is, the earlier you start saving money and generating wealth, the better your financial scenario will be in the long term. Regardless of whether you intend to get married, start a family, or secure a home, there are a number of financial targets that every individual in their 20’s should strive to accomplish so as to secure a better a future. In this article, we’ll be taking a closer look at these goals and how you can begin building healthy financial habits.
Put together a budget
Building healthy financial habits starts with learning how to budget. Being able to spend less money than you make is the key to saving money, so start taking control of your money by setting up a budget and sticking to it! With a pen and paper, write down your monthly income and costs. Look over your expenses to find out which can be cut down, or which can be eliminated totally. Some ways to cut your expenditures are choosing to eat at home in lieu of eating out and swapping your Cable television subscription to streaming services like Amazon instead.
Eliminate your debts
Whether or not you’ve travelled the globe or have student loan debts, the faster you repay these debts, the better. Interest compounds as time passes, so repaying your debts by cutting down expenditures or working a 2nd job could save you thousands of dollars in only a number of years. These savings can then be invested in a high-interest term deposit for instance, which will put you in a far better financial position than merely making the minimum monthly repayments on your debts.
Create an emergency fund
Life seldom works out the way you planned, so it is vital to be prepared for any abrupt adjustments that may be necessitated. You may find yourself out of work, or in an unfortunate incident that stops you from working, so having an emergency fund will be able to give you a bit of breathing space when you need it the most. Financial advisors propose that all folks should have a dedicated emergency fund that can support their living expenses for 3 to 6 months.
Insurance protects you financially from any detrimental consequences, for instance income insurance in the event you lose your job, medical insurance for unanticipated medical expenses, and vehicle insurance in the event your car is stolen. While it’s not necessarily wise to get every kind of insurance available, it’s most certainly a clever idea to examine your individual circumstances to see which is best suited to you. For instance, health insurance is highly recommended for everyone due to the inflated costs of uninsured medical treatment. Without insurance, an unanticipated incident may result in significant damage to your financial situation.
Invest in a diversified portfolio
If you’ve managed to save a specific amount of money that is otherwise sitting idle in the bank, consider investing this money in a high-interest term deposit. Once you’ve got more money saved, think about buying a property, or investing in gold. The key to a solid investment portfolio is ‘diversification’, meaning that you manage the risks of investment by putting your eggs in different baskets, so to say.
Seek financial assistance immediately
If, for whatever reason, you’ve ended up in financial turmoil, the best advice is to seek financial help as soon as possible. A lot of individuals wrestle with financial troubles for many years before getting help, which puts them in a worse position as their debts will only compound with time. The sooner you get financial guidance, the more options are available to you, so if you need any help with your financial condition, get in contact with the professionals at Bankruptcy Experts Penrith on 1300 795 575, or visit our website for additional information: www.bankruptcyexpertspenrith.com.au