Adulthood comes with many responsibilities, one of the most important being financially secured. And for many young adults, this is a challenging task. According to a survey from Junior Achievement USA, 54 percent of teenage respondents express their worries about not being able to afford their future.
But it doesn’t have to be that way. You can take measures to set yourself up for a bright and prosperous future. Here are some best practices for being financially comfortable as a young adult.
Invest in yourself
Many young adults need to pay more attention to invest in themselves, but this is a crucial mistake. Investing in yourself means taking the time and effort to grow as an individual, both professionally and personally. When you invest in yourself, you can earn more money and advance your career.
There are many resources to help you get started, including books, websites, and even online courses. If you think your current degree or job isn’t providing you with the skills you need to succeed, consider getting a degree or taking classes in a more competitive field.
For instance, white-collar jobs require those with knowledge in science, technology, education, and mathematics (STEM). If you want to land competitive jobs in the STEM strand, make sure you get a degree or take courses in those areas. In doing so, you’ll have more edge and be more marketable in the pool of applicants.
No matter what route you decide to take, remember that investing in yourself is always worth the effort and investment. In doing so, you can stay ahead of the curve, earn more money, and achieve greater financial security.
Save as much as you can
It may seem like you don’t have much to save when starting out, but every little bit helps. You can start small by setting aside a few dollars each week into a savings account. Then, as your income increases, you can start putting away more. The key is making saving a habit, so it becomes second nature.
Learning to control yourself early on is crucial to maintaining financial comfort as an adult. One of the best ways to do this is to create and stick to a budget. When making a budget, account for all your expenses, including rent, utilities, food, transportation, and entertainment. Then, ensure you’re sticking to that budget by tracking your spending.
There are many ways to keep track of your spending, including using applications or creating spreadsheets. With this tool, you can see where your money is going and make adjustments to stay on track. Thus, you can avoid overspending and getting into debt.
Live below your means
One of the best ways to stay on top of your finances is to live below your means. However, it might not be easy as it sounds. According to news reports, the average American consumer overspends $7,400 annually. That’s due to factors like credit card debt and lifestyle inflation.
But you can avoid being a part of this statistic by learning to live below your means. Simply put, it means spending less than you earn and being mindful of your spending habits. When you’re able to do this, it frees up more money you can save or invest for the future.
It takes discipline to live below your means, but it’s a habit worth developing. When you’re able to do this, you can avoid financial stress and have more peace of mind. As a result, you can focus on other aspects of your life and reach your long-term goals.
Have an emergency fund
Life is unpredictable, so it’s essential to have an emergency fund in case something unexpected comes up. This fund should be used for unforeseen expenses like medical bills, car repairs, or job loss. An emergency fund gives you peace of mind knowing that you have a safety net if something goes wrong.
Essentially, you must have three to six months of living expenses saved before you can feel comfortable. It may seem like a lot, but it’s crucial to have this money set aside in case of an emergency.
To start building your emergency fund, you can open a savings account and set up automatic transfers from your checking account. Then, ensure you’re not dipping into this account for non-emergency expenses. Once you have a solid emergency fund, you can rest assured knowing you’re prepared for anything life throws your way.
Taking control of your finances is essential for ensuring financial success in adulthood. There are many things you can do to set yourself up for success, and the above tips are a great place to start. Remember, it’s never too late to start making positive changes in your financial life. So don’t wait – start taking steps today to achieve financial comfort in the future.