One perk of being a young adult, and perhaps freshly out of school, is finally being in charge of your own money, even if you are still living at home. Having this new spending power comes with the responsibility of making good decisions that will eventually secure your financial independence, both short-term and long-term. To begin, read up on 6 of our favorite financial tips for young adults seeking to save up and start out.

1. Save Before Spending

Once upon a time, you spent for whatever you wanted or needed, and what was left went into your piggy bank or saving account. Now it’s time to switch that spending pattern around. When you get your salary, set aside a fixed percentage for savings. Then pay off any bills or utilities before using what’s left for wants and other expenses. 

 2. Control The Credit Card

In many ways, credit cards are a godsend. They allow for cashless transactions and make large purchases and emergencies so much easier to handle. However like all good things, credit cards need to be used in moderation. Always keep track of what you are using your card on, and never forget to settle your payments on time, so as to avoid overdue or late charges. Another tip is to have only one credit card, to help avoid the temptation to overspend.

3. Practice Prevention Over Cure

The saying “an ounce of prevention is better than a pound of cure” is true when it comes to young adult life. Taking simple steps to prevent emergencies saves you from the trouble of shelling out huge sums to fix a burdensome problem. This means making sure your car undergoes routine maintenance, that small repairs at home are done right away, and that you are up to speed on your doctor’s appointments. These simple things can save you from being wiped out by paying for major help from mechanics to do specialized repairs, or doctors to manage your complicated health conditions!

4. Get Health Insurance

A sudden hospitalization can really wreck your finances; it is not unheard of for families to go into major debt and bankruptcy to save a loved one. Make sure this does not happen to you by getting a health insurance policy early, and paying the premiums religiously. You may not need it right now, but unfortunately there is no way to predict illnesses or accidents. A plus to health insurance is that it can help your dependents, which may be your parents, your siblings, or even your spouse and your children down the road.

5. Live Well, Not Expensively

Social media and envy are a lethal combination for the frugal. It can be very tempting to max out your card on the latest gadgets, empty your bank account to travel to the same beaches your friends partied at, or take out exorbitant loans to have the wedding of your dreams. However, spending all of these does not necessarily guarantee you are getting the best value for your money. Do your research on products and services, and find out where you can cut costs without sacrificing quality. Purchase based on durability and usability, and not on trends alone.

6. Talk to a Financial Advisor

Nowadays, more and more financial advisors are becoming visible to the general public. Chances are, at least one of your friends is already in the business of advising people on investments and savings. Use these connections and talk to a financial advisor who can look at your resources, consider your goals, and help you formulate a plan to reach them while achieving financial independence. There is no need to wait to earn big bucks, or worse, reach a major crisis before talking to an advisor. Usually they are willing to help you out or at least have a quick meeting, no matter the state of your finances.

Achieving financial independence does not mean having to live on bread and water for the foreseeable future or eschewing all opportunities to have fun with family and friends. With a few smart decisions, young adults can be well on their way to managing their money and attaining stability.

photo from blog.chandlerknowlescpa.com