You’ve just landed your first ‘real’ job and taking your first full steps into adulthood. You have started your career and a steady paycheck is being directly deposited into your account each month. Life is good. You’re ready to treat yourself with a new car or maybe you’re dreaming about purchasing your first house. Hold tight for just a minute. Make sure you understand how large purchases affect your financial resources. This will set a healthy foundation for you and your family and put you on the path to a healthy financial future. Allegacy is here to help you get started with these tips:
Where am I starting?
It’s hard to get where you are going if you don’t know where you are. Write down how much money you have on hand and how much you owe.
What do I want to accomplish?
Set smaller goals that can bring success in a short period of time – determine how much you need to save from each paycheck to reach your goal instead of focusing on the full amount.
Pay yourself first. Unexpected expenses happen. A car needs new tires, a medical emergency sends you to the emergency room, or you need to travel to your best friend’s destination wedding – but with an emergency fund, you’ll be ready for these unplanned occasions.
Make a plan to get there.
List all your monthly expenses, then subtract that from your monthly income. Be sure to include the amount you want to save each month. You should have more money coming in than going out.
Develop healthy habits.
If you’re spending more than you make, you can’t become financially fit without cutting expenses or increasing your income. Instead of paying to have your car washed, you could wash it yourself. Maybe you could pack a lunch instead of eating out. Are there apps on your phone or tablet that have automatic renewals that you no longer use? Could you find a roommate to share housing expenses? To earn extra money, do you have a hobby that you could freelance? Or maybe you could find a part-time job to supplement your income.
Unfortunately, many young adults find themselves embarking on independence strapped with credit card and student loan debt. Make it a priority to pay those off as quickly as possible, starting with the smallest debt first. Once that debt is paid, use the extra money on the next-smallest debt, etc. Or maybe a Debt Consolidation loan could help you lower your monthly bills and get you out of debt quicker.
Don’t give up.
Sticking to a budget takes discipline. Review your budget and your bottom line each month and make adjustments as you go. You will make mistakes. Learn from them. Now is the perfect time to be your best and plan for a financially healthy future. You’ve got this!
The information contained above is for informational purposes only and is provided as a service to our members, and is not legal or tax advice. Some links included on this page route to sites owned by an independent third party unaffiliated with Allegacy. Such links are provided only as a convenience. Allegacy does not manage the operation or content of third‐party websites and is not responsible for the privacy or security policies on third‐party sites. Beware of disclosing personal or account information.