|March 23, 2018||0|
There’s no doubt that your 20’s is a very memorable period of your life. There’s a timid but exhilarating sensation about becoming an adult, leaving home, and being financially independent. Regardless of whether you launched a career, a university degree, or spent time traveling the world and gaining life experience, your 20’s is an important decade from both a personal and financial viewpoint. No matter what path you go with, the one constant that will continually remain in your life is money.
The fact of the matter is, the earlier you begin saving money and creating 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 home, there are various financial goals that every individual in their 20’s should try to reach to secure a better a future. In this blog, we’ll be taking a closer look at these goals and how you can begin creating healthy financial habits.
Put together a budget
Constructing healthy financial habits begins with understanding how to budget. Being able to spend less money than you earn is the key to saving money, so start taking control of your finances by setting up a budget and sticking to it! With a paper and pen, list your monthly income and costs. Study your expenditures to find out which can be cut down, or which can be removed altogether. Some ways to reduce your expenditures are choosing to eat at home instead of eating in restaurants and substituting your Cable subscription to streaming services like Amazon instead.
Remove your debts
Regardless if you’ve travelled the globe or have student loan debts, the quicker you repay these debts, the better. Interest compounds over time, so paying off your debts by slashing expenses or working a second job can save you thousands of dollars in only a number of years. These savings can then be invested in a high-interest term deposit as an example, which will put you in a considerably better financial position than merely making the minimum monthly repayments on your debts.
Build an emergency fund
Life hardly ever works out the way you planned, so it is very important to be prepared for any unforeseen adjustments that might be necessitated. You could find yourself out of work, or in an accident that stops you from working, so having an emergency fund will be able to give you a bit of breathing room when you need it the most. Financial specialists strongly recommend that all individuals should have a devoted emergency fund that is capable of supporting their living expenses for three to six months.
Insurance protects you financially from any adverse consequences, for instance income insurance should you lose your job, health insurance for unanticipated medical expenses, and vehicle insurance in the event that your car is stolen. Though it’s not always beneficial to get every form of insurance available, it’s most certainly a smart idea to analyse your individual circumstances to see which is best suited to you. For example, medical insurance is strongly recommended for everyone due to the high costs of uninsured medical treatment. Without insurance, an unexpected incident may cause serious damage to your financial position.
Invest in a diversified portfolio
If you’ve managed to save a specific amount of money that is otherwise sitting idle in the bank, look at investing this money in a high-interest term deposit. After you’ve got more money saved, contemplate buying a property, or investing in gold. The key to a sound investment portfolio is ‘diversification’, meaning that you handle the risks of investment by putting your eggs in different baskets, so to say.
Get financial help as soon as possible
If, for whatever reason, you’ve found yourself in financial turmoil, the best advice is to seek financial assistance immediately. Lots of people struggle with financial issues for many 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 advice, the more options are available to you, so if you need any assistance with your financial situation, talk to the professionals at Bankruptcy Cairns on 1300 818 575, or visit our website for further information: http://www.bankruptcy-cairns.com.au/