Best financial advice
Best financial advice First of all I must congratulate you for thinking about financial advice in your 20s. I am assuming you are working and having your own income.
From maxing out credit cards, taking unnecessary student loans, to delaying my savings, I got off to a rocky start. I sometimes wonder how I even have anything to my name.
Now into my 30’s, what I wouldn’t give to go back to my 20-year-old self and try to talk to sense into him.
But since I know myself rather well, I’m pretty sure I wouldn’t have listened. Ha!
You don’t have to get off to a rocky start, though.
“When you’re in your twenties you’re really forging for your future. Things take shape later on.”
These 10 rules for finances in your 20s should help you get things in order before you.
1. Avoid Credit Card Debt ( Best financial advice)
One of the best things you can do for your finances in the long term is to avoid credit card debt. Make it a point to have the money in your account before you charge something. High-interest credit card debt can ruin your finances over time, leeching away your wealth.
I, unfortunately, learned this lesson the hard way. My dad, who struggled with credit card debt for most of his life, actually encouraged me to open a credit card when I was still in college.
2. Only Borrow What You Need for an Education
I had a full-tuition scholarship (because I joined the National Guard) and a cushy job in the mall at GNC. With all of my resources, there was no reason for me to take out the maximum in student loans. But I did anyway.
While you might need to borrow to fund your education, don’t take more than you need to make it work. The smaller your debts, the better.
3. Be Careful about Borrowing for Anything Else Best Financial Advice for 30 Year Olds
Whether it’s a house or a car, be careful about borrowing. The rule about only getting what you need applies for all your loans. Yes, you will probably need to borrow if you want to pay for a house. But you don’t need to go overboard; modest homes and modest cars paid for with solid down payments, are your best choice. Financial Advice Tips
4. Pay All Your Bills on Time
As a fledgling adult, you are now responsible for many of your own costs. It’s vital that you pay all your bills on time. You don’t want to miss payments for utilities, your phone plan, or other items.
Missed payments can have a number of consequences that can be far-reaching, including messing up your credit score for years. That’s right, I said YEARS.
5. Open a Savings Account
While you’re at it, open a savings account. Look for a high-yield account that offers you the chance to earn a return. Then, set up a regular schedule for adding money to your checking account. Even if it’s only a few dollars a week, the important thing is to get in the habit of saving.
6. Learn about Investing
Now is a great time to learn about investing. Find out how you can use the money to improve your returns. Get the basics of how to invest in low-cost funds, as well as how you can use dividend stocks to your advantage.
When you understand the basics of investing, you are better able to build wealth over time. Learn how you can use a taxable investment account in addition to your tax-advantaged retirement account to boost your wealth.
7. Consider a Side Hustle
Even the most marketable of us run the risk of being jobless if economic conditions are especially difficult. A side hustle can help you diversify your income. Consider starting up a small side business that can help you cultivate an alternative income stream so that you don’t have to rely too heavily on a single source of income.
A side hustle I failed at was real estate. I could have given up, but that led to me starting my blog, which has been a great side hustle. Don’t give up after one attempt.
8. Give to Others
Well-rounded finances include efforts to help others. Whether you give money to your church, donate to charity, or volunteer, you can give of your time, money, and effort. Efforts to give to others generally result in better financial management, and can even expose you to new opportunities.
9. Establish Your Priorities
Think about what you value, and what is important to you. Now is a great time to establish your spending priorities. Consider how you want to use your money, and what you want your money to accomplish on your behalf. Then, instead of wasting money on the things that don’t matter to you, you can use your money to purchase things and experiences that are important.
10. Create a Spending Plan or Budget
Put together a plan for your money. Base your spending plan or budget on your priorities. Understand your cash flow so that you know how much money you have coming in each month, and what expenses need to be paid as well. You don’t need to account for every dollar (although that can help), but you do need a plan that helps you stay on track, and that allows you to meet your goals.
BONUS: Learn to Say No
Know how to say no. This means that you might have to say no to a purchase you want (or at least put it off). Sometimes it means saying no to loved ones as you attempt to make time for yourself and your job. Sometimes, it even means saying no to a job that isn’t working for you. Learning how to say no — and knowing when to use this word — can help you use your financial resources more effectively.
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