How you handle your money early on in life—from being a stickler about adhering to a monthly budget to starting to save for retirement as soon as possible—can lay the groundwork for a strong financial future.
And it can be as simple as adopting these five money-savvy habits, which can help put you on the road to being financially healthy for years to come.
1. Stick to a Budget
A great first step toward future financial success? Creating—and sticking to—a monthly budget, so you can track your spending and help ensure that you’re living within your means. And since your budget will probably evolve as your income changes and other financial priorities arise, it can be good to get into the practice of following a spending plan that can help keep you on track no matter what’s ahead.
2. Build an Emergency Fund
If you lose your job, get seriously ill or suddenly have to replace your car, your emergency fund is the money you can use to help stay afloat. And while you might feel young and invincible, these situations can—and do!—creep up. To get started, consider setting up a direct deposit from each paycheck into your savings account, so you’ll never even miss the cash.
3. Save for Retirement
Even though it may seem like your golden years are a lifetime away, the truth is that the earlier you start saving, the more cash you’re likely to have once you’re finally ready to retire. Can’t save as much as you’d like? Even small monthly contributions can multiply over time!
4. Set Financial Goals
It can be tough to stick to a budget when the temptation to spend on fun things clouds our better judgment. That’s why it’s important to set concrete money goals—whether it’s eventually buying a house or paying down debt—and make sure that you’re working on putting money toward these goals each month. The thrill of achieving money goals can be addictive—and may inspire you to set even bigger ones down the road.
5. Consider Buying a Life Insurance Policy
Think you don’t need life insurance as a young, single person? Think again. Life insurance can provide protection beyond just covering a spouse or children should you pass away. In fact, if someone cosigned a loan for you, purchasing a policy can help prevent that person from being saddled with the debt. Bonus: Shopping for life insurance as a young, healthy adult can mean locking in lower, more affordable premiums.
This article was written by LearnVest from Forbes and was legally licensed by AdvisorStream through the NewsCred publisher network.
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