|March 23, 2018||Comments Closed|
There’s no question that your 20’s is a very special period of your life. There’s a nervous but fulfilling sensation about becoming an adult, leaving home, and being financially self-reliant. Whether you kicked off a career, a university degree, or spent time traveling the globe and gaining life experience, your 20’s is an important decade from both a personal and financial point of view. Regardless of what path you choose, the one constant that will consistently remain in your life is money.
The fact of the matter is, the earlier you begin saving money and developing wealth, the better your financial condition will be in the long term. Regardless of whether you want to get married, start a family, or buy a property, there are certain financial targets that every individual in their 20’s should endeavour to achieve in order to secure a better a future. In this blog, we’ll be taking a closer look at these goals and how you can begin establishing healthy financial habits.
Set up a budget
Creating healthy financial habits begins with knowing 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 paper and pen, write down your monthly income and expenditures. Review your expenditures to find out which can be reduced, or which can be eliminated altogether. A few ways to cut down your expenses are choosing to eat at home as opposed to eating in restaurants and transferring your Cable television subscription to streaming services like Netflix 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 with time, so repaying your debts by cutting spendings or working a 2nd job can save you thousands of dollars in only a couple of years. These savings can then be invested in a high-interest term deposit for example, which will place you in a far better financial position than simply making the minimal monthly repayments on your debts.
Set up an emergency fund
Life hardly ever works out the way you planned, so it is very important to be prepared for any abrupt adjustments that might be required. You could end up unemployed, or in an 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 highly recommend that all people should have a dedicated emergency fund that can support their living expenses for 3 to 6 months.
Insurance protects you financially from any adversarial consequences, for example income insurance should you lose your job, medical insurance for unpredictable medical expenses, and vehicle insurance in case your car is stolen. Even though it’s not always recommended to get every type of insurance available, it’s most certainly a smart idea to evaluate your individual situation to see which is best suited to you. For example, health insurance is highly recommended for everyone due to the high costs of uninsured medical treatment. Without insurance, an unforeseen incident may lead to considerable damage to your financial situation.
Invest in a diversified portfolio
If you’ve been able to save a specific amount of money that is otherwise sitting idle in the bank, consider investing this money in a high-interest term deposit. When you’ve got more money saved, think about buying some property, or investing in gold. The key to a sound investment portfolio is ‘diversification’, meaning that you manage 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 turmoil, the best advice is to seek financial assistance immediately. Too many individuals battle with financial complications for years before finding help, which puts them in a worse position as their debts will only compound as time passes. The sooner you seek financial assistance, the more options are available to you, so if you require any assistance with your financial situation, talk to the professionals at Bankruptcy Joondalup on 1300 818 575, or visit our website for more information: http://www.bankruptcy-joondalup.com.au/