There are so many articles that have this exact same title. Some written by 20 year old’s and some by 60 year old’s and some in between that. But they all say the same thing: get an emergency fund, start a budget, don’t eat avocado toast everyday, etc. However, I’m here to try and spice things up and get you thinking some new ideas. These are things I’m trying to do in my 20’s. Let’s spice things up together! Here they are:
- Track Your Net Worth Every Month
This right here is one of the best indicators on tracking your financial health over a long-term period. If you are saving money for retirement or eliminating debt, this number will be increasing. For those who don’t know, your net worth is simply: assets (savings, house, etc.) minus your debts (mortgage, student loans, etc.). This is the simplest way to determine whether or not you are succeeding financially. Number goes up? Bueno. Number goes down? No bueno. Easy as that. Almost as easy as beating my friend Bailee in NBA 2K.
- Enjoy Your Money
What?!? “You’re telling me to enjoy my money and spend it instead of save every penny?’ Yes. Yes I am. You only live once (YOLO) on this earth and there is only so much time you have while you’re young to really live it up. Studies have shown that people who spend money on experiences tend you enjoy their money more than if they spend it on things (classic millennials). Go explore and find new cultures. Go invest in new hobbies and meet new people. But whatever it is, make sure you are enjoying what you are doing. Could you spend extra money going out or buy clothes? Sure. But that’s not the point. The point is to experience life and live out your dreams. So dream big.
- Triple your savings
Welp. After I talk about spending money, I’m going to talk about saving it. One goal we have is to triple our savings. Easy goal if you are 22, but harder if you are 29. However, make it a point to try and triple your current amount. If you reach that goal early, try it again. Currently have $5,000? Make it $15,000 by age 30 (I hope I didn’t insult you by performing simple math in my post). While most people will probably yell “that’s not nearly enough to have at that age!” That’s not the point. The point is to just get used to saving more money at an early age. Learn how to manage your money where you save and spend all at once. It’s a beauty when you figure it out.
- Get Out Of Debt
Okay, to be fair, every list you have read has this on it. Sorry for lying earlier about spicing things up. But it’s important. Debt is one of the biggest roadblocks people have with financial success. We had this goal and completed it. It’s an amazing feeling. While there is no such thing as “good debt”, there is, in my mind, “better debt”. Consumer debt (car loans, credit card debt) sucks. A mortgage however, isn’t bad if it isn’t straining you from reaching your current goals. Should you still pay off your mortgage as quick as possible? Definitely. If you don’t, will it hinder you in reaching financial independence earlier? Definitely. But is it inherently bad? No. Make small steps and tackle your debt.
- Compile A List Of All Accounts/Balances
This right here is for all my married couples. Something I try to do, however fail often at, is letting my wife know where we are financially. I am the CFO in our household. So it is my responsibility to hold status meetings with my wife. This sounds so rigid and structured, but most of the time it is on the couch while enjoying a glass of wine. To make this easier, I have an excel sheet of all our accounts, where they are held, and how much is in them. This makes it easy for my wife to find if I were to kick the bucket. But, as in all relationships, communication is key. So. Make the list, communicate it to your significant other, and keep it up to date. Easy.
Boom! Now you are on your way to tackling money and life while in your 20’s. If this list seems easy, then knock em out and make harder goals. If it seems hard, then tackle one point at a time and go from there. Wherever you’re at, the main goal of this is for you to set tangible goals and plans for your money. Cheers to living the life you always wanted and conquering the pitfalls of money!
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