It’s no secret that millennials have it tough when it comes to finances – we’re the generation that’s saddled with student loan debt, underemployment, and rising costs of living. But despite all of that, we also have a lot of potential. We’re the most educated generation in history, and we have the power to change our financial future.
So where do you start? If you’re in your 20s and looking to get your finances in order, here’s a guide for how to set yourself up financially for success. You can also choose to bring in professional help – accountants will help build your financial future.
1. Make a budget
This is the first and most important step to taking control of your finances – you need to know exactly how much money you have coming in and going out every month. Track your spending for a few months so you can see where your money is going and make adjustments accordingly. There are a lot of helpful budgeting apps out there that can make this process easier, like Mint or YNAB.
2. Build up an emergency fund
This is a crucial part of financial stability. Having an emergency fund gives you a cushion to fall back on if you lose your job or encounter an unexpected expense. Aim to save enough money to cover 3-6 months of living expenses – this may seem like a daunting task, but you can start small by setting aside $50 from each pay check until you reach your goal.
3. Invest in yourself
One of the best ways to set yourself up for financial success is to invest in your own education and career growth. Consider taking classes or getting a certificate in something that will help you get ahead in your field, and don’t forget about the power of networking! Attend industry events and meetups so you can connect with other professionals in your field. These relationships could lead to new opportunities down the road.
4. Live below your means
This is easier said than done, but it’s important to remember that lifestyle inflation is real – just because you get a raise doesn’t mean you need to start buying all new clothes and going out to eat all the time. If you can stick to a budget and live below your means now, you’ll be in good shape when it comes time for retirement.
Start making small changes like cooking at home more often and choosing less expensive entertainment options, and over time you’ll be able to save more and more money.
Good luck!
Setting yourself up for financial success in your 20s isn’t easy, but it’s definitely possible with some planning and discipline. By following these steps, you’ll be on your way to a bright financial future.