Financial Rules for Your 20s

Posted on: in [ Personal Finances ]

Being a “twentysomething” today is simultaneously exciting and terrifying. You have recently entered the adult world, (hopefully) have a job and are able to start exploring who you are and who you want to be.

But you have expenses to deal with. Student loans must be repaid, rent is due at the beginning of the month, utilities halfway through the month, and groceries aren’t free either. It can be overwhelming.

However, your friends at State Bank have put together a few rules you should follow throughout your twenties to take control of your finances. Having more control will help you feel less stressed and will help you enjoy this exciting time of your life to the fullest.

Establish your budget – start by saving receipts for everything for a month. When the month is up, categorize your spending using Mint or any other financial management tool. Then, add in your income. If you’re spending more than you bring home, you need to make adjustments.

Make a plan to reduce your debt – if you can, set your student loan payments on auto pilot. This will ensure you don’t miss a payment. If you have credit card debt, use this calculator to see how long it will take to pay it all off. Oh, and don’t miss a payment even if that means only paying the minimum.

Start an emergency fund – Step one: open a savings account if you don’t have one. Step two: set up an automatic transfer to that account from your checking account every pay period. This will ensure you are on the path to getting three to six months’ worth of expenses saved in case of an emergency.

Leave the Mom and Dad Bank – You’re an adult, so stop expecting your parents to foot the bill. This means getting your own insurance, phone plan and anything else they would normally cover. It may mean more expenses, but you get independence in return.

Picking up good financial habits in your twenties is a good first step towards your long-term goals. If you are embarking on a new phase of life, talk to the experts at State Bank. We can help you figure out how to budget and save to pay off debt, start saving and more. Stop by today!

 

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