|March 23, 2018||0|
There’s no doubt that your 20’s is a very precious phase of your life. There’s an anxious but gratifying sensation about becoming an adult, leaving home, and being financially independent. Whether or not you started a career, a university degree, or spent time traveling the world and gaining life experience, your 20’s is a crucial decade from both a personal and financial viewpoint. Regardless of what path you choose, the one constant that will consistently remain in your life is money.
The truth of the matter is, the sooner you begin saving money and creating wealth, the better your financial prospects will be in the upcoming years. Regardless of whether you wish to get married, start a family, or invest in a property, there are certain financial targets 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 objectives and how you can begin creating healthy financial habits.
Establish a budget
Building healthy financial habits starts with discovering 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 making a budget and following it! With a pen and paper, list your monthly income and expenditures. Explore your expenditures to see which can be lowered, or which can be removed altogether. Some ways to reduce your expenditures are opting to eat at home as opposed to eating out and switching your Cable subscription to streaming services like Netflix instead.
Eliminate your debts
Regardless of whether you’ve travelled the world or have student loan debts, the faster you repay these debts, the better. Interest compounds with time, so repaying your debts by slashing spendings 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 instance, which will put you in a much better financial position than simply making the minimum monthly repayments on your debts.
Establish an emergency fund
Life hardly ever works out the way you planned, so it is very important to be prepared for any unforeseen changes that might be necessitated. You may find yourself 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 recommend that all individuals should have a dedicated emergency fund that can support their living expenses for 3 to 6 months.
Insurance protects you financially from any adverse consequences, for example income insurance should you lose your job, health insurance for unplanned medical expenses, and vehicle insurance in case your car is stolen. While it’s not always wise to get every kind of insurance available, it’s undoubtedly a smart idea to examine your individual situation to see which is best suited to you. For example, medical insurance is highly recommended for everyone due to the high 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 managed to save a specific amount of money that is otherwise sitting idle in the bank, think about investing this money in a high-interest term deposit. When you’ve got more money saved, contemplate purchasing a property, or investing in gold. The key to a solid investment portfolio is ‘diversification’, meaning that you deal with the risks of investment by putting your eggs in different baskets, so to say.
Seek financial help as soon as possible
If, for whatever reason, you’ve ended up in financial turmoil, the best advice is to seek financial assistance immediately. Too many individuals struggle 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 guidance, the more options are available to you, so if you require any assistance with your financial position, speak to the specialists at Fresh Start Solutions Sydney on 1300 818 575, or visit our website for additional information: Bankruptcy Sydney