Everyone knows the adage, “Time is money,” and that adage certainly applies to getting the most for your money in your 20s. Managing your finances for the first time can be overwhelming. Twenty-somethings have the greatest financial asset of all time. Time makes money grow when invested wisely. The sooner you start making a financial plan, the brighter your future will be. Here are several smart financial moves for people in their 20s.

1. Set financial goals. Write them down and figure out how much you’ll need to save each month to reach your goals. Remember to take note of financial goals big and small, from going on spring break next year to taking early retirement.
2. Make a budget and stick to it. Limit debt to your ability to pay it. Monthly credit payments (not including mortgages) must not exceed 20% of your net income. Also, start by paying existing bills before you incur new ones.
3. Start building an emergency fund. This should equal three to six months of living expenses and should be used ONLY in the event of an emergency.
4. Save at least 10% of your gross income. Put it in your emergency fund, for future goals and retirement. If you can’t get to 10%, start with smaller amounts and work your way up to 10%. Saving any amount is better than nothing.
5. Take advantage of the financial services your bank or credit union offers you as a customer/member.
6. Get adequate insurance. This includes health, disability, auto, renters/homeowners, and life insurance. It is very important to avoid buying insurance that you do not need in your 20s.
7. Once you’ve completed steps 1-6, start investing small amounts of your savings. Do this gradually over time, with sensible contributions.
8. Save money for retirement. I know retirement isn’t even a blip on your radar screen. But it will never be easier to start saving than right now. Use your employer’s tax-advantaged savings plans, such as 401(k) plans, or open individual retirement savings plans (Roth IRAs) from your bank or credit union.
9. Build your credit history. You will need to go into some debt because no credit is just as bad as bad credit. Most importantly, show that you can manage that debt to build your credit history and get a good credit score.
10. Write short, medium and long term goals. I am not suggesting that you need to map out your entire life. However, having an idea of ​​where you want to go in life will make it easier for you to make smart decisions with your money. With that in mind, write down where you want to be in one year, five years, 10, and 20 years. Your personal goals can be things like marriage, children, travel, career, home ownership, etc.
11. Plan to pay cash for everything. I think being able to pay for everything in cash can be life changing. Tell yourself that you will be the person who always pays cash. That doesn’t mean you’ll never take out a loan or get a credit card. But it does mean that he will think a little longer before going into debt.
12. Keep your job skills fresh and up to date. This will keep your job options open and allow for salary increases.
13. Save all financial files. Keep it in a neat and easily accessible system so they are available when you need them.
14. Leave the bank of mom and pop. It’s time to release your parents from your financial responsibilities. At the age of twenty, the main goal should be to become self-sufficient. So, look to get off your parents’ payroll and go it alone.
15. Clean up your online presence. Whether you like it or not, everyone can see your activity on social networks, including all your current or potential employers. Organize your digital event by searching online at Spokeo.com or pipl.com to see what’s already available for people to see.