There’s no doubt that your 20’s is a very memorable stage of your life. There’s an anxious but fulfilling sensation about becoming an adult, moving out of home, and being financially self-reliant. Regardless of whether you launched a career, a university degree, or spent time traveling the globe and gaining life experience, your 20’s is a critical decade from both a personal and financial point of view. Whichever path you go with, the one constant that will continually remain in your life is money.
The fact of the matter is, the sooner you begin saving money and generating wealth, the better your financial prospects will be in the years to come. Regardless of whether you want to get married, start a family, or secure a property, there are a number of financial targets that every person in their 20’s should strive to accomplish to secure a better a future. In this article, we’ll be taking a closer look at these targets and how you can start developing healthy financial habits.
Put together a budget
Establishing 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 finances by creating a budget and sticking to it! With a pen and paper, list your monthly income and expenses. Review your expenditures to find out which can be cut down, or which can be removed completely. A few ways to lessen your expenditures are choosing to eat at home as opposed to eating out and transferring your Cable TV subscription to streaming services like Amazon instead.
Get rid of your debts
Whether you’ve travelled abroad or have student loan debts, the faster you repay these debts, the better. Interest compounds with time, so repaying your debts by reducing spendings or working a 2nd job can save you thousands of dollars in only a couple of years. These savings can then be invested in a high-interest term deposit as an example, which will put you in a significantly better financial position than only making the minimal monthly repayments on your debts.
Build an emergency fund
Life almost never works out the way you planned, so it’s important to be prepared for any unanticipated changes that might be needed. You might find yourself out of a job, or in an accident that stops you from working, so having an emergency fund will be able to give you some breathing space when you need it the most. Financial specialists strongly recommend that all people 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 adverse consequences, for example income insurance in case you lose your job, health insurance for unanticipated medical expenses, and vehicle insurance in case your car is stolen. Though it’s not always sensible to get every form of insurance available, it’s definitely a smart idea to analyse your individual circumstances to see which is best suited to you. For example, health insurance is recommended for everybody due to the high costs of uninsured medical treatment. Without insurance, an unexpected incident may result in significant damage to your financial position.
Invest in a diversified portfolio
If you’ve been able to save a specific amount of money that is otherwise sitting idle in the bank, think about investing this money in a high-interest term deposit. When you’ve got more money saved, contemplate purchasing a property, or investing in gold. The key to a sound investment portfolio is ‘diversification’, meaning that you deal with the risks of investment by putting your eggs in different baskets, so to say.
Get financial assistance immediately
If, for whatever reason, you’ve found yourself in financial trouble, the best advice is to seek financial help immediately. Too many individuals struggle 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 guidance, the more options are available to you, so if you need any support with your financial condition, get in contact with the specialists at Bankruptcy Experts Dubbo on 1300 795 575, or visit our website for additional information: www.bankruptcyexpertsdubbo.com.au