What They Need to Know
The best financial advice for young adults is to start building good money habits early on. It can be tough to make ends meet when you’re just starting out, but if you learn how to manage your finances wisely, you’ll be in a much better position down the road. Consumer Portfolio Services will discuss some of the most important things young adults need to know about money. We’ll cover everything from budgeting and saving to investing and retirement planning. So whether you’re just starting out in life or you’re looking for ways to improve your financial situation, read on for some helpful tips!
The first thing young adults need to know about money is how to create a budget. A budget is simply a plan for how you will use your income each month. It helps you track your spending and make sure you’re not overspending on unnecessary things. One way to create a budget is to list all of your monthly expenses, including rent/mortgage, utilities, groceries, transportation, etc. Then, subtract your total expenses from your monthly income. This will give you an idea of how much money you have left over each month to save or invest.
Another important thing young adults need to know about money is the importance of saving. Even if it’s just a small amount each month, starting early will help you build up a nice savings cushion down the road. One way to make saving easier is to set up a automatic transfer from your checking account to your savings account each month. This way, you won’t even have to think about it – the money will just automatically be transferred into your savings.
Investing is another important financial topic young adults need to be aware of. When you invest, you’re essentially putting your money into something with the hopes of earning a return on your investment. For example, you might invest in stocks, which can give you the potential to earn dividends as well as capital gains if the stock price goes up. Or, you might invest in real estate, which can provide you with rental income as well as the potential for appreciation if property values increase over time.…