Your 20s are often thought as a time to enjoy life and take many adventures. While this is true (and really, you should enjoy life at every age!), it’s also important you start building a foundation for financial wellness. A US News report found that 57% of millennials aren’t even saving yet – a stat that needs to change.
The American Consumer Council recently partnered with Kim Curtis to discuss financial goals young adults should reach by the age of 30. Here is the video:
In the video, these 7 goals came up:
1. Establish Financial Independence
Young adults should aim to be financially independent from their parents by the age of 25. This means you need to be in charge of all your bills, and ideally have left the nest. If you’re forced to move back home, work to save up money and prepare to get your own place as soon you’re on your feet again.
2. Stop Overdrafting Your Checking Account
It can be easy to get in the habit of overdrafting your checking account, but that’s a habit you need to learn to break as you get older. Set up a budget, and keep track of your spending to make sure you aren’t going over what you have.
It’s also good to look at overdraft protection options, like linking a FlexLine of Credit to your checking account.
3. Pay Bills on Time
If you don’t pay your bills on time, your credit is going to take a hit. Pay bills by their due date, and if you’re having trouble, consider setting up autopay.
Many financial institutions, including Aspire, offer Bill Pay options in online banking to help make things easier.
4. Have a Direction for Your Career
By the time you’re 30, chances are you’ve logged a few years in a specific industry. You should have an idea of where you’re heading and the road map to get there. If you’re unsure, take some time to explore your options and figure out what makes the most sense.
5. Pay Down Debt
You’ll want to focus on saving for retirement and/or your children’s education when you get to your 30s and 40s, which means paying down debt should be a high priority in your 20s.
If you can’t pay it off completely, pay more than the minimum payment each month to pay it off faster.
6. Participate in Your Employer’s Retirement Plan
The US News report found that 40% of millennials also have no retirement strategy. Many employers offer 401(k)s, and it’s something you should take advantage of right away. You’ll also find employers often match up to a certain percentage, which is essentially free money.
7. Learn to Discuss Finances with Your Partner
Financial issues are a leading cause of separation and divorce. The trouble usually occurs because of miscommunication. Sit down with your partner and work out a budget, how you’ll split expenses and savings expectations. Set monthly meetings to make sure everyone is on base and comfortable.
If you can hit these goals in your 20s, you’ll be well on your way to being financially comfortable in the coming decades.