Most of the time, twenty-something people don’t see their money as resources for wealth building. Instead of saving, these people often use money to buy things or spend money to impress friends. They should know however, that the best time to start learning good money-handling habits is during their 20s. The chances are the habits they develop during these times are more likely to financially affect their future.
People in their twenties should consider developing a savings plan. Starting an emergency savings account would be a smart move for them. It is not necessary for them to place big amounts of money all at once. They can start small and set aside around 10% of their total income and deposit that amount into their savings account. So in case they experience financial crisis, they can always have their emergency savings account to fall back on.
Although they might think that it’s too early to start thinking about retirement, it might be a good idea to consider doing so. Everyone knows that having a Social Security account is important. However, not all of them know that it is not entirely advisable to depend on Social Security alone after retirement. In addition to their personal Social Security account, they might also use a portion of their salaries to contribute to their employer’s retirement savings account.
Apart from these two, twenty-something people must learn to cut down or minimize excessive spending. When it comes to practicing good spending habits, differentiating the things you need from the things you want before buying is always the golden rule. Buying tons of stuff might leave you with more liabilities than assets.
In addition to this advice, people in their twenties should develop the habit of paying their bills on time. Most of them might know by now that when bills become delinquent, will not look good on their credit reports. Apart from that, they may also pay for additional fees and higher interest rates if they fail to pay their bills before the due date.
