Money Management Tips for Young Adults
- Earn money by getting a part-time job or helping mom and dad around the house
- Save part of what you earn, at least 10%
- Save a portion of monetary gifts you receive for holidays and birthday gifts, at least 10%
- Open a savings account at a bank for the money you save and deposit it as soon as possible so that you don’t accidently spend it
- Set a savings goal. Be ambitious enough that you have to work for it but realistic enough that the goal is achievable. Saving $500 might be a good start.
- Periodically compare your current savings to your savings goal to see the progress you are making. And remember, each time you take money out of your savings account you get further from your savings goal.
- Make a budget so that your income covers your expenses and savings and put it in writing
- Stick to your budget!
- Track your expenses and review periodically to understand where your money is going
- Understand the difference between debit card and credit cards
- Educate yourself about investment options such as money markets, certificates of deposit (CDs), stocks, bonds, mutual funds, etc.
- Research the following terms and understand how they apply to different savings and investment options: debt, credit, interest, compound interest, diversification, risk, identify theft and the Rule of 72
- Build and maintain good credit by using credit cards wisely; only carry a balance when absolutely necessary
- Be aware of bank fees and where charges can apply such as minimum balance requirements, ATM charges, overdraft fees, etc
- Keep account numbers and debit/credit card numbers confidential to reduce the risks of identity theft
- Talk to your parents about saving, budgeting, credit and debt to get their perspective