|March 23, 2018||2|
There’s no doubt that your 20’s is a very enjoyable phase of your life. There’s an anxious but exciting sensation about becoming an adult, moving out of home, and being financially independent. Regardless of whether you launched a career, a university degree, or spent time traveling abroad and gaining life experience, your 20’s is a valuable decade from both a personal and financial point of view. No matter what path you decide upon, the one constant that will continually remain in your life is money.
The reality of the matter is, the sooner you start saving money and generating wealth, the better your financial condition will be in the long term. Regardless of whether you choose to get married, start a family, or invest in a house, there are particular financial aspirations that every person in their 20’s should strive to accomplish in order to secure a better a future. In this article, we’ll be taking a closer look at these goals and how you can begin constructing healthy financial habits.
Make a budget
Constructing healthy financial habits begins with knowing 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, write down your monthly income and expenses. Study your expenses to see which can be reduced, or which can be removed altogether. Some ways to reduce your expenditures are electing to eat at home in lieu of eating out and transferring your Cable television subscription to streaming services like Amazon instead.
Remove your debts
Regardless if you’ve travelled overseas or have student loan debts, the quicker you repay these debts, the better. Interest compounds over time, so paying off your debts by slashing spendings or working a second job can save you thousands of dollars in only a few years. These savings can then be invested in a high-interest term deposit as an example, which will place you in a significantly better financial position than only making the minimum monthly repayments on your debts.
Develop an emergency fund
Life hardly ever works out the way you planned, so it is vital to be prepared for any abrupt adjustments that might be necessitated. You could find yourself out of a job, or in an unfortunate incident that inhibits you from working, so having an emergency fund will be able to give you some breathing space when you need it the most. Financial specialists propose that all folks 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 damaging consequences, for instance 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 necessarily beneficial to get every form of insurance available, it’s most certainly a clever idea to evaluate your individual circumstances to see which is best suited to you. For instance, health insurance is recommended for everyone due to the high costs of uninsured medical treatment. Without insurance, an unforeseen incident may cause serious 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, look into investing this money in a high-interest term deposit. Once you’ve got more money saved, contemplate purchasing some property, or investing in gold. The key to a good 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 ended up in financial hardship, the best advice is to seek financial assistance as soon as possible. A lot of people wrestle with financial troubles for several years before seeking help, which puts them in a worse position as their debts will only compound with time. The sooner you seek financial advice, the more options are available to you, so if you need any assistance with your financial situation, talk with the professionals at Fresh Start Solutions on 1300 818 575, or visit our website for further information: https://freshstartsolutions.com.au