Ten Smart Money Moves For People In Their 20s!

Make the most of your working years and prepare early for your life's goals. If you're in your 20s, you have a financial asset money can't buy: TIME. And time makes your money grow. Making some smart money moves in your 20s pays off now and in the future.

  1. Set financial goals to take a vacation, go back to school, get married, buy a house or start saving for an early retirement. Put your goals in writing, then calculate how much you'll need to save each month to reach them.

  2. Make a spending plan, limit your debt and concentrate on paying off existing bills. If you use credit, limit debt to your ability to repay. Dont chase a big credit limit without having a reaching ability to pay that limit. Experts say that monthly credit payments, excluding a mortgage, shouldn't exceed 20% of your monthly take-home (after-tax) pay. If you have trouble meeting your financial obligations, seek help before you fall behind.

  3. Build an emergency fund equal to three to six months' living expenses, even if it takes years to build. Use this fund only for true emergencies, such as unexpected car repairs, illness or unemployment. Make regular deposits to your emergency fund account via payroll deduction or direct deposit.

  4. Save at least 10% of your gross income for the emergency fund, your future goals and retirement. If you can't manage 10%, start with 5% and increase it over time.

  5. Take advantage of the savings accounts and loans offers. Preferably I would suggest to secure a credit union bank. You'll earn more when you save and pay less when you borrow.

  6. Make it a priority to get adequate health, disability, auto, personal liability and tenant's or homeowner's insurance. If someone else depends on your income, you may also need life insurance especially if you are still not grasping the concept on the need to save.

  7. Once you've implemented your spending plan, built your emergency fund and obtained appropriate insurance, make the most of your money by starting to invest. The key is to invest small amounts gradually and sensibly over time. Think in terms of at least five to ten years down the line. Investments need that much time to ride out the inescapable ups and downs of the market.

  8. To save money for your retirement, use tax-advantaged savings programs such as company 401(k) plans and Individual Retirement Accounts (IRAs).

  9. Keep job options open by keeping your job skills fresh. Get the necessary training and education so that your knowledge and skills stay up to date. But keep in mind that college/universities are definitely not for everyone. Even those who graduate fall trap to no utilization of degree accomplished so choose carefully and build wisely. A degree doesn't guarantee the income bracket desired.

  10. Establish and maintain orderly financial files. Keep your tax returns, statements from financial institutions and copies of your insurance policies as organized and as accessible as possible.

If you are in your 30s and have yet to begin those steps then its never too late to start. Feel free to start checking in on various investments. Their money is not your money. Because it’s credit or loan doesn't mean you should maximize it. Because you have a need to enjoy life doesn't mean you should do it in debt. Because flossing, vacations, and showing an high life can be referenced as the norm, doesn't mean you should clear your bank. Think smart and early!

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