As young people transition from living at home to living on their own, they visualize a life of promise and fulfillment. Along the way, the difficulties of navigating toward that dream often pop up. Some of the most common dilemmas revolve around money and finances. Here’s a few that resonate with many young adults: How am I going to finance my education? How can I buy a car? I haven’t saved much and my rent is due?
The key to successful navigation in these often uncharted waters is to become aware of your situation, develop a good and actionable plan, create a savings fund, use credit wisely, and partner with trusted professionals. We’ve put together some of the best financial advice for young adults
First and foremost, take personal stock and become aware of your situation. Be objective and positive. Each of us has a unique set of circumstances, has different ideas and comes from a specific background. Take stock of your skills. Assess your financial situation. Flesh out your goals. Consider putting this in writing and add to it over the next few weeks.
Have a Financial Plan
The next step is to develop a plan that is tailor-made for you. Your plan should include your near-term, intermediate-term and long-term goals, the approximate time-frames for each and how you will finance them. Start with the short-term goals first. For example, perhaps an important short- or intermediate-term goal is to buy a car. However, at the moment, you have very little money to your name.
A potential plan for this goal would include researching the best car for your needs, using other forms of transportation in the meantime, and getting a part-time job to build up the cash for your vehicle. As you build your plan, you will want to ensure you tackle the following items:
- Establishing a savings account,
- Sharing your resources and
- Guidelines for using credit.
Let’s take a look at each of these:
Create a savings fund
A savings fund, no matter how large or small, is essential for financial health. Establishing a savings account and adding to it regularly builds confidence and financial security. A small percentage of your income should systematically be placed into savings. You will be able to achieve your goals better with some money in the bank. Even more importantly, you will be able to take care of emergencies that should arise. Finally, you’ll be establishing a habit that will generate confidence in your ability to more forward in life. Your local credit union or bank will be able to help.
As you develop your plan do not become too self-centered. Realize you are a part of the human family. Share a portion of your money, time and talents with those less fortunate or in need. You will be repaid many times over, sometimes in ways you cannot foresee.
Be Careful with Debt and Credit
Be careful with debt and credit. It has become very easy to obtain a credit card or get a loan for almost anything. Never forget that you will have to pay it back and then some with interest. Not having any debt creates confidence and gives you free cash to spend or save. Many prudent people have a credit card but use it sparingly.
Finally, Seek Trustworthy Professional Partners
By now, you know that your future and the financial means to achieve it is largely within your own hands. Develop your plan, create a saving program and use credit conservatively, if at all. Seek out the assistance from knowledgeable family members. Additionally, look to trusted professionals. Here at Eastex Credit Union, we’d understand your financial health is a priority, let us know if there is anything we can assist you with. We are here to help.