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Financial Advice for Young Adults-3 Practical Money Management Tips

By Edited Jul 13, 2016 4 15

Start Young Adulthood on the Right Financial Foot

Before spending your very first paycheck, here is some financial advice for young adults. These money management tips are going to be the foundation for your future. When you are in your early twenties, these goals may seem too far off to be concern yourself with, but today’s economic reality is not the one previous generations faced.

Financial Advice for Young Adults-Save, Save, Save

Sure, it is tempting to spend your entire paycheck on fun, toys, vacations, and clothes. You studied hard, now you work hard, you deserve it, right?

Financial Advice for Young Adults

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What many young adults do not comprehend is that the younger you are, the easier it is to save money. This money management tip is true-ask anyone who has gotten married, bought a house, or has children. It’s hard to save when you have two kids in braces or a house that needs a new water heater!

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When you graduate from a place of higher learning, whether it be a four year university, a two year college or a technical school, you will have to spend money on wardrobe basics when you land your first job. Consider this an investment in your future.

Ladies, this does that mean you have to go shopping for a Chanel suit, a Marc Jacobs handbag and Manolo Blahnik shoes. And guys, no Armani suits for you, either. Buy good quality basics, add to your wardrobe a little at a time, and when you can afford to, you can upgrade your wardrobe. Invest in classic accessories that will last for years and not need to be replaced. 

If you are living at home, you have the (hopefully) once in a lifetime opportunity to sock away almost all of your paycheck. Offer your parents some money for rent and food, and then save the rest. This is money management at it’s best.  

Financial Advice for Young Adults-Avoid Credit Card Debt

This tip for money management should be taught at schools from the time kids can understand what credit card debt is. You should not get yourself financially in the hole for clothes, food and vacations. If you cannot pay your bills, this will damage your FICO score, which will in turn make it harder for you to get a mortgage when you want to buy a home or get a loan for a car.
If you are able to secure financing even though you have debt, rest assured that it will be at a much higher percentage than a person who has no credit card debt. That ski vacation to Vermont that you could not pay in full will cost you thousands more in the future with higher mortgage payments.

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The Final Financial Tip-Start Saving for Retirement Now

One of the best money management tips is to start your retirement fund while you are young. Whether it is a 401K (hopefully with matching money from your employer, which is free money for you), a 403b, a Roth IRA or any other kind of retirement account, open it! The beauty of compounding interest is that the earlier you begin to set aside money for your future, the more money you will have for it.

The later you open a retirement account, the more you will have to put into it to get to your financial retirement goals. And the older you are, the more likely it is that you will have a family to support. The extra money to achieve your goals may not be there.

This financial advice for those starting out in life is just a springboard for a better future. These three tips for money management will give you a strong foundation for everything you want to achieve in your future.



Apr 18, 2012 12:05pm
Your article deals with some very important questions. Great job!
Apr 18, 2012 6:37pm
Thank you!
May 12, 2012 9:08am
Now you sound like me mommymommmymommy. This advice is not only good for young people, its good for many adults as well.
May 15, 2012 7:03pm
Great points. I still struggle with money management and I'm 34!!!
May 15, 2012 9:27pm
Trust me, you are still young! It is important to start saving young, so you can enjoy life when you are older!
May 16, 2012 12:08am
Great advice! The savings you accumulate when you are young can make a real difference in your financial picture and future. Good feature, congratulations.
May 30, 2012 6:26pm
Thank you for reading it!
Jun 11, 2012 8:29am
Great advice. I agree that money management should be taught to kids in school.
Jun 22, 2012 10:57pm
One of the classes I remember taking in high school was a money management class. They taught you how to balance a check book, plan expenses when you first move away from home and other useful things. I think it was in my sophomore year. It was a great class, just like your article!
Nov 27, 2012 4:58pm
Thank you! It is such an important thing to learn.
Sep 10, 2012 10:23pm
Through thirteen years of school, I received about 30 minutes of financial education. Some guy showed up in our grade 9 math class and told us that if we put so many dollars away each month into this plan that we would be millionaires by the time we were 60. What useless advice for 15 year olds. How about teaching kids how to balance a check book, economics, how to create passive income online, how to live within your means, the curse of compound interest, how to invest in real estate etc. I could go on. I wish I had received some sort of financial education but I learned it all the hard way in my 20s.

Awesome article!
Nov 27, 2012 4:59pm
You are spot on! Kids need to be responsible at a young age, but it has to be something they can relate to. I am trying to teach this to my children, but at times it falls on deaf ears.
Oct 10, 2012 11:26pm
Really appreciated the article. It's definitely easier said than done, but I'm not sure anybody in their late 50's would say, "I'm sure glad I bought all of those baseball cards in the 80's!" instead of stashing away extra cash.
Nov 27, 2012 5:01pm
LOL! You are right!
Dec 20, 2012 12:38am
My stepson is 11 years old and we already educate him about managing your money. This means that he sets aside 25% of his allowence for saving/investing and he is so excited to see the money in his bankaccount grow! We hope that we get him into this habit long before he is sole responsible for his money ;-)
Right now we're exploring the possibilities for hem to make some money online, he wants to create his own game-website...
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