Maybe you’re just starting your career and wondering how to manage your money. Or perhaps you feel like it’s time to start investing and you’re looking for financial tips. Well, you’ve come to the right place. Learn all you need to know about budgeting, personal finance and savings strategies for young adults.
Stick to a Monthly Budget
The first lesson in learning how to manage your money: You’ve got to stick to your monthly budget. Don’t have one yet? Create one asap. Having a budget is a key step toward curbing spending and saving money when you’re young. By creating and sticking to a budget, you’ll help ensure that you can cover all the necessities — and make room for some extras. Learn how to create a personal budget and track your spending every month.
Choose Insurance That Will Protect You in an Emergency
Insurance policies can protect you and your bank account when things go wrong. There are many kinds of insurance to consider getting in your 20s, including home, auto and even life. Insurance can help provide protection from liability, damages and financial loss. Protecting yourself, your family and your assets against loss is one of the most important reasons for having the right kind and amount of coverage.
Maintain a Healthy Credit Score
When plotting your personal financial strategy, remember that you’ll have to manage your credit score, too. Your credit history can determine what kind of loans you qualify for, as well as the interest rate you’ll pay on them. Building a solid credit history can have a big impact on your future financial well-being and set you up for money management success down the road. Choose your credit cards wisely, especially when you’re selecting your first credit card. Peruse the terms and conditions, keep an eye out for annual fees and be aware of the interest rate. Be sure you know how much you’ll be charged if you pay late or exceed the credit card limit. Also, be mindful of your budget, as overspending is far easier with credit cards. You might consider strategies like setting a monthly spending limit, only spending cash for set periods of time or discussing potential big-ticket purchases with an accountability partner, like a family member or friend, before putting them on your credit card.
Have a Financial Backup Plan
A financial safety net is a crucial part of any money management plan. Without one, you could find yourself one unfortunate event away from financial disaster. A solid savings strategy for young adults might include a savings account with several months’ worth of living expenses, adequate insurance and a secondary or alternate source of income. In case you face an emergency, such as your home needing repairs or a loved one becoming sick suddenly, building an emergency fund is critical for your peace of mind.
Start Saving for Tomorrow Today
The sooner you begin saving, the more time your money has to grow. Finding ways to save money and earn interest now will help you get on track toward managing your money in the long term. With compound interest, a few dollars today could turn into big money over the course of a lifetime. Make a plan to start saving for everything from your kids’ higher education to your own retirement. Retirement account options include a 401(k) plan through your employer, a traditional or Roth IRA, mutual funds and annuities. Though retirement might seem a long time away in your 20s, it’s never too early to start saving for retirement.
Map Out Your Financial Goals
Don’t just dream about being better at money management. Put an actionable plan in place. Financial goals require regular consideration and effort over a long period of time. Having a workable financial strategy can help you make your goals a reality. For instance, do you want to repay your student loans? You could pay off your student loans steadily and incrementally or try to fast-track your repayment timetable through tactics such as making additional payments, refinancing your loan and applying for loan forgiveness.
We Can Help You Manage Your Money
Take the next step in preparing for your financial future by contacting a Farm Bureau agent or advisor today. An experienced agent can help you find the right insurance coverage that will protect your bank account when the unexpected happens.