There’s no doubt that your 20’s is a very precious phase of your life. There’s a timid but exhilarating sensation about becoming an adult, moving out of home, and being financially independent. Regardless if you started a career, a university degree, or spent time traveling the world and gaining life experience, your 20’s is a significant decade from both a personal and financial context. Regardless of what path you go with, the one constant that will consistently remain in your life is money.
The truth of the matter is, the earlier you begin saving money and developing wealth, the better your financial scenario will be in the upcoming years. Regardless of whether you choose to get married, start a family, or purchase a property, there are specific financial goals that every individual in their 20’s should try to accomplish so as to secure a better a future. In this post, we’ll be taking a closer look at these goals and how you can start constructing healthy financial habits.
Put together a budget
Establishing healthy financial habits begins with learning how to budget. Being able to spend less money than you earn is the key to saving money, so start taking control of your money by forming a budget and following it! With a paper and pen, jot down your monthly income and expenditures. Take a look at your expenses to find out which can be cut down, or which can be cut out totally. A few ways to lessen your expenses are electing to eat at home rather than eating out and replacing your Cable television subscription to streaming services like Netflix instead.
Get rid of your debts
Whether you’ve travelled overseas or have student loan debts, the faster you repay these debts, the better. Interest compounds with time, so repaying your debts by slashing expenditures or working a 2nd job can save you thousands of dollars in only a number of years. These savings can then be invested in a high-interest term deposit for example, which will place you in a much better financial position than merely making the minimum monthly repayments on your debts.
Set up an emergency fund
Life seldom works out the way you planned, so it is vital to be prepared for any abrupt changes that might be needed. You may end up out of work, or in an incident 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 experts highly recommend that all individuals should have a dedicated emergency fund that is capable of supporting their living expenses for 3 to 6 months.
Insurance protects you financially from any adverse consequences, for instance income insurance in the event you lose your job, medical insurance for sudden medical expenses, and vehicle insurance in the event your car is stolen. Though it’s not always sensible to get every kind of insurance available, it’s most certainly a clever idea to assess your individual circumstances to see which is best suited to you. For example, health insurance is strongly recommended for everybody due to the high costs of uninsured medical treatment. Without insurance, an unanticipated incident may cause significant damage to your financial situation.
Invest in a diversified portfolio
If you’ve managed to save a certain amount of money that is otherwise sitting idle in the bank, think about investing this money in a high-interest term deposit. After you’ve got more money saved, consider purchasing a property, or investing in gold. The key to a sound investment portfolio is ‘diversification’, meaning that you regulate the risks of investment by putting your eggs in different baskets, so to say.
Get financial help as soon as possible
If, for whatever reason, you’ve found yourself in financial distress, the best advice is to seek financial assistance immediately. A lot of folks battle with financial troubles for several years before getting help, which puts them in a worse position as their debts will only compound with time. The sooner you seek financial guidance, the more options are available to you, so if you require any guidance with your financial position, get in touch with the specialists at Bankruptcy Experts Newcastle on 1300 795 575, or visit our website for additional information: www.bankruptcyexpertsnewcastle.com.au