Financial planning is something you can start at any age—hopefully before you’re even off to college! Making good choices early in life is a great way to set yourself up for long-term success (and maybe early retirement, too). Here are some smart money moves for you to make in your 20s.
Build a Credit Score
A good credit score is essential for life in the United States. Whether you’re planning to rent apartments or buy a house, landlords and realtors want to see a sparkling credit score before moving ahead with any paperwork. Having a good credit score is also crucial for saving you money annually, as you’ll get better terms for credit cards and loans based on how high your score is.
If you want to build up your score, the best option is to get a credit card and pay it off every month. You can even set up a recurring monthly payment (perhaps to a subscription service like Netflix) to charge your credit card, so you’re guaranteed to have something to pay off each month. If you consistently prove you’re responsible with credit, your score will be sky-high.
Create a Budget (and Follow It)
Tracking your income and expenses month by month is an essential part of your financial responsibility. It might seem like a ton of work, but it will help you determine how much you need to save each month and whether there’s any money left over to use as disposable income.
Save for Retirement
This may sound cliché, but it’s never too early to save for retirement. Check out your employer’s options for retirement plans, and don’t worry if you’re self-employed. The Simplified Employee Pension plan is perfect for freelancers—you can save for retirement without a regular place of employment.
Now that you know these smart money moves for you to make in your 20s, get yourself on a path to success and ensure a relaxing retirement.
