There’s no question that your 20’s is a very precious period of your life. There’s an anxious but fulfilling sensation about becoming an adult, leaving home, and being financially independent. Regardless if you started a career, a university degree, or spent time traveling abroad and gaining life experience, your 20’s is a significant decade from both a personal and financial perspective. Whichever path you choose, the one constant that will always remain in your life is money.
The point of the matter is, the sooner you start saving money and generating wealth, the better your financial prospects will be in the upcoming years. Regardless of whether you plan to get married, start a family, or secure a property, there are certain financial goals that every individual in their 20’s should strive to reach in order to secure a better a future. In this post, we’ll be taking a closer look at these goals and how you can begin establishing healthy financial habits.
Set up a budget
Constructing healthy financial habits begins 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 putting together a budget and sticking to it! With a pen and paper, jot down your monthly income and expenditures. Examine your expenditures to uncover which can be reduced, or which can be cut out altogether. A few ways to cut your expenses are choosing to eat at home rather than eating out and switching your Cable subscription to streaming services like Amazon instead.
Eliminate your debts
Regardless if you’ve travelled overseas or have student loan debts, the faster you repay these debts, the better. Interest compounds over time, so paying off your debts by cutting spendings or working a second job can save you thousands of dollars in only a number of years. These savings can then be invested in a high-interest term deposit as an example, which will place you in a substantially better financial position than just making the minimal monthly repayments on your debts.
Start an emergency fund
Life seldom works out the way you planned, so it is crucial to be prepared for any unanticipated changes that might be necessitated. You might find yourself unemployed, 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 highly recommend that all folks should have a dedicated emergency fund that is capable of supporting their living expenses for three to six months.
Insurance protects you financially from any undesirable consequences, for example income insurance should you lose your job, medical insurance for unforeseen medical expenses, and vehicle insurance in the event your car is stolen. Even though it’s not necessarily a good idea to get every form of insurance available, it’s unquestionably a clever idea to examine your individual situation to see which is best suited to you. For example, medical 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 position.
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. After you’ve got more money saved, consider purchasing some property, or investing in gold. The key to a good investment portfolio is ‘diversification’, meaning that you manage the risks of investment by putting your eggs in different baskets, so to say.
Get financial assistance immediately
If, for whatever reason, you’ve ended up in financial turmoil, the best advice is to seek financial assistance immediately. Too many people wrestle with financial troubles for years before finding help, which puts them in a worse position as their debts will only compound as time passes. The sooner you seek financial assistance, the more options are available to you, so if you need any support with your financial situation, speak with the professionals at Bankruptcy Experts Mackay on 1300 795 575, or visit our website for more information: www.bankruptcyexpertsmackay.com.au