|March 23, 2018||0|
There’s no doubt that your 20’s is a very enjoyable stage of your life. There’s a nervous but exciting feeling about becoming an adult, moving out of home, and being financially self-reliant. Regardless of whether you began a career, a university degree, or spent time traveling the world and gaining life experience, your 20’s is an important decade from both a personal and financial context. Whichever path you go with, the one constant that will constantly remain in your life is money.
The fact of the matter is, the earlier you begin saving money and building wealth, the better your financial condition will be in the upcoming years. Regardless of whether you choose to get married, start a family, or invest in a house, there are a number of financial goals that every individual in their 20’s should attempt to reach to secure a better a future. In this article, we’ll be taking a closer look at these targets and how you can begin developing healthy financial habits.
Create a budget
Building healthy financial habits begins with understanding 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 setting up a budget and following it! With a paper and pen, jot down your monthly income and expenses. Take a look at your expenditures to find out which can be cut down, or which can be eliminated completely. A few ways to reduce your expenses are opting to eat at home in lieu of eating out and transferring your Cable TV subscription to streaming services like Netflix 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 as time passes, so paying off your debts by cutting down expenditures or working a second 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 place you in a far better financial position than just making the minimum monthly repayments on your debts.
Develop an emergency fund
Life hardly ever works out the way you planned, so it’s important to be prepared for any sudden adjustments that might be needed. You might find yourself unemployed, or in an incident that stops you from working, so having an emergency fund will be able to give you some breathing room when you need it the most. Financial specialists recommend that all individuals should have a devoted emergency fund that is capable of supporting their living expenses for 3 to 6 months.
Insurance protects you financially from any adverse consequences, for example income insurance in case you lose your job, health insurance for unpredictable medical expenses, and vehicle insurance in the event your car is stolen. Though it’s not always sensible to get every form of insurance available, it’s certainly a wise idea to evaluate your individual circumstances to see which is best suited to you. For instance, medical insurance is strongly recommended for everybody due to the high costs of uninsured medical treatment. Without insurance, an unplanned incident may cause significant damage to your financial situation.
Invest in a diversified portfolio
If you’ve managed to save a particular amount of money that is otherwise sitting idle in the bank, consider investing this money in a high-interest term deposit. When you’ve got more money saved, think about buying some property, or investing in gold. The key to a sound investment portfolio is ‘diversification’, meaning that you manage the risks of investment by putting your eggs in different baskets, so to say.
Seek financial assistance as soon as possible
If, for whatever reason, you’ve found yourself in financial turmoil, the best advice is to seek financial assistance immediately. A lot of people wrestle with financial issues for several years before seeking help, which puts them in a worse position as their debts will only compound with time. The sooner you get financial assistance, the more options are available to you, so if you need any assistance with your financial condition, get in contact with the specialists at Bankruptcy Fremantle on 1300 818 575, or visit our website for additional information: http://www.bankruptcy-fremantle.com.au/