|March 23, 2018||Comments Closed|
There’s no question that your 20’s is a very precious period of your life. There’s a timid but exhilarating sensation about becoming an adult, leaving home, and being financially independent. Whether you started a career, a university degree, or spent time traveling in foreign countries and gaining life experience, your 20’s is a crucial decade from both a personal and financial context. No matter what path you decide upon, the one constant that will constantly remain in your life is money.
The fact of the matter is, the sooner you start saving money and generating wealth, the better your financial scenario will be in the future. Regardless of whether you want to get married, start a family, or invest in a property, there are particular financial targets that every person in their 20’s should try to accomplish to secure a better a future. In this article, we’ll be taking a closer look at these goals and how you can begin building healthy financial habits.
Put together a budget
Creating healthy financial habits begins with learning how to budget. Being able to spend less money than you make is the key to saving money, so start taking control of your finances by setting up a budget and following it! With a pen and paper, list your monthly income and costs. Inspect your expenditures to see which can be cut down, or which can be cut out totally. Some ways to cut your expenditures are electing to eat at home as opposed to eating out and substituting your Cable TV subscription to streaming services like Amazon instead.
Get rid of your debts
Regardless if you’ve travelled the globe or have student loan debts, the quicker you repay these debts, the better. Interest compounds with time, so paying off your debts by cutting down expenses or working a second job might save you thousands of dollars in only a few years. These savings can then be invested in a high-interest term deposit for example, which will put you in a significantly better financial position than just making the minimum monthly repayments on your debts.
Start an emergency fund
Life rarely works out the way you planned, so it is very important to be prepared for any unanticipated adjustments that may be necessitated. You might find yourself out of a job, or in an accident that stops you from working, so having an emergency fund will be able to give you a bit of breathing space when you need it the most. Financial advisors recommend that all folks should have a dedicated emergency fund that is capable of supporting their living expenses for three to six months.
Insurance protects you financially from any undesirable consequences, for instance income insurance in the event you lose your job, medical insurance for unanticipated medical expenses, and vehicle insurance in case your car is stolen. While it’s not always sensible to get every type of insurance available, it’s undeniably a smart idea to review your individual circumstances to see which is best suited to you. For example, medical insurance is highly recommended for everyone due to the inflated costs of uninsured medical treatment. Without insurance, an unanticipated incident may cause considerable damage to your financial position.
Invest in a diversified portfolio
If you’ve been able 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. After you’ve got more money saved, contemplate buying some property, or investing in gold. The key to a solid investment portfolio is ‘diversification’, meaning that you regulate the risks of investment by putting your eggs in different baskets, so to say.
Seek financial help immediately
If, for whatever reason, you’ve found yourself in financial hardship, the best advice is to seek financial help as soon as possible. Too many people wrestle with financial complications for many years before seeking help, which puts them in a worse position as their debts will only compound with time. The sooner you seek financial assistance, the more options are available to you, so if you need any support with your financial situation, talk to the professionals at Bankruptcy Penrith on 1300 818 575, or visit our website for more information: https://www.bankruptcy-penrith.com.au/