Millenial financial targets can feel extremely impossible to hit. For the most part, many 20-year olds aren’t sure what their financial goals or targets should be or how to go about ensuring that they are starting off on the right financial foot?
“What do you mean I can no longer spend the entirety of my salary on avocado toast and expensive uber rides”? For most of us, our 20s are a time of self-discovery, a time of self-growth. Our twenties are our first steps into adulthood and experiencing what it takes to be somewhat financially stable. We go quickly from being broke students to being broke adults and somewhere along the way we’re supposed to figure out how to handle this financial wakeup call as adults who can manage their finances in the long haul.
These millenial financial targets, however, are not as easy as they may seem, but whether you like it or not your 20s are the perfect time to start making some important financial decisions that can help set you up for a lifetime of financial stability.
Life is full of unexpected curveballs and you never know what is going to be thrown at you at any given time, whether it’s a sudden illness or unforeseen job loss. Life’s unexpected hiccups can really wreck your financial plan – especially if you’re not prepared.
That’s why it’s so essential to have an emergency fund. Without one, you risk being unable to pay your bills if you are without an income for a period of time. Your 20’s is the best time to start saving as it’s likely you don’t have overheads, dependants or property payments that saving money is easier than it will be later in life. Be sure to keep your emergency money somewhere safe, like a bank account, so it is always there when you need it. While it is usually a good idea to invest any money you’re not using right away. However, your emergency fund should be your one exception as it needs to be immediately available to you and not tied up in investments.
Save For Retirement
It’s unlikely that in your 20’s you’re thinking about something as far as retirement. But in reality, your 20’s are the perfect time to start saving – because the sooner you do the more time that money has to grow. Ideally, you should try to save 10% of each paycheck for retirement. In fact, anything you can put away will ensure a better tomorrow for yourself, every cent counts, even a small amount makes a difference because every amount has the potential growth.
Pay Off Your Student Loans
The average student in South Africa has between R50,000 – R150,000 in student debt. These loans usually come with high-interest rates and repayment periods of 10 years, so the sooner you’re able to pay off your debt the less money you’ll end up spending unnecessarily on interest charges. Plus, once you have eliminated these repayments you’ll have freed up some extra money to invest in achieving other financial goals.
Improve Your Credit Score
We all know the importance of having a good credit score. Firstly, it improves your chance of getting approval for personal loans, apartment rentals, car insurance or anything else you might need to function as an independent adult. Secondly, if you have managed to keep a high credit score when you’re ready to buy a house you’ll likely to score a more favorable mortgage rate when the time comes around. Taking steps to improve your credit score in your 20’s can work in your favour both in the short term and the long term.
While these aren’t exactly millenial financial targets are a guideline to help 20 somethings, take the right steps into a prosperous financial future. These millenial financial targets should be applied with the utmost determination to succeed. As the choices you make today have the power to impact the rest of your life for better or for worse. So, while you find yourself your 20’s where you have little responsibility and minimal overheads try to achieve these millenial financial targets. Saving money and paying off debt may not be as fun as overpriced coffee but if you commit to achieving these financial targets for millennials you can be assured of obtaining a financially responsible lifestyle early on, one that future you will be thankful for.