Updated: Sep 11
We all have goals and aspirations for our futures that will require you to plan ahead with your finances, like buying your first car, moving out of your parents’ house or even going travelling! As a young person, you may not have a lot of financial responsibility right now, but it’s never too early to start building good habits and setting yourself up for a successful financial future. Here are some tips to get you started:
1. Create a budget. Start by tracking your expenses and income for a month, and then use that information to create a realistic budget. This will help you avoid overspending and ensure you have enough money for everything you need.
2. Build an emergency fund. Life is unpredictable, and it's always a good idea to have money set aside for emergencies. Start by saving enough to cover three to six months' worth of living expenses.
3. Avoid debt. It can be tempting to use credit cards or take out loans to buy things you want, but this can lead to a cycle of debt that’s hard to break. Try to only use credit for emergencies or to build credit.
4. Invest in your future. Start thinking about your long-term financial goals, like saving for retirement. Talk to a financial advisor about the best investment options for your age and income.
5. Live within your means. Trying to keep up with your friends or live beyond your means is a quick way to lose control of your finances. Instead, focus on what you can afford, be mindful of your spending and theres nothing wrong with saying ‘no’ to things every now and then. Remember, even if you can’t afford it now, you can always put money aside so that you can afford it comfortably later.
6. Pay bills on time. Paying your bills on time can help you avoid late fees and protect your credit score. Set up automatic payments for bills like rent and utilities to make sure they're always paid on time.
7. Use online resources. There are plenty of online resources, including personal finance apps, that can help you stay on track with your finances.
Some resources to explore:
8. Be patient. Building financial stability takes time and patience. Don’t get discouraged if you don’t see immediate results. Stick to your budget, save regularly, and make smart financial choices.
Remember, being financially responsible isn’t always easy, but it’s worth the effort. By starting early and building good habits, you’ll set yourself up for a prosperous and secure financial future.