This is a collaborative post.
Your 20s are a decade full of change. You’re just finding your feet as an adult, establishing a career, navigating new friendships and relationships and finding out who you are and what you want. And often, establishing savings can be a low priority at this time. Need to purchase a home, pay for kids’ education and even think of retirement seem really distant. But actually, your 20s are the ideal time to make some smart financial choices and get into good habits for when life takes over. Those far away, large-sum targets can seem impossible, but by taking lots of little steps, early on, you can make a difference to your situation at the end of the decade, and face turning 30 in a much better position.
Keep Your Savings Separate
A lot of us have good intentions when it comes to saving some of our income, only to find at the end of the month that our outgoings have spiralled and we don’t have anything left over to save. Or likewise, if we have a heavy month, it can be tempting to dip into our savings to fund that ‘must have’ festival ticket or weekend away. So a good tip is to keep your savings account with a different bank from your primary checking account. Having an extra step to do to be able to transfer funds gives you just the pause you need to make you think about if that splurge is worth it. Set up a direct debit to pull money into your savings each month, the day after you get paid. It will be gone before you can spend it, and when you remember to take a peek, it will have mounted up nicely.
Lower Your Bills
The power of negotiation is a great way to lower your monthly outgoings, which gives you far more scope for spare cash to save. So make lowering the bills your special mission. Anything you pay each month, like a mobile phone bill or a utility, it’s worth speaking to your provider to see what discount they can offer, or use comparison sites to find the best deals. If you’re paying towards servicing debt, then consider debt relief programs to lower your monthly costs.
Have a Cash Free Week
Set aside a week each month to keep cash free. It takes a little forward planning, but it’s a powerful habit to get into. Make sure the bills are paid, you have enough food in the house, and you’ve prepped some healthy and tasty lunches in advance, then hide your cards and cash in a drawer and go through the week without spending. It’s easier than you think!
Practice Delayed Gratification
We’re all imbued in a have-it-now culture, but you can rediscover the power of delayed gratification. Planning ahead to replace big-ticket items like electronics and white goods during Black Friday can save you hundreds. Knowing the off peak travel times can net you a cheaper holiday. And keeping a wish list where you add the things that would have been impulse purchases is also a great idea. If you still want it at the end of the month, go ahead – but you’ll be surprised how many ‘must-haves’ you no longer feel the need for with an inbuilt cooling off period.
Buy Little And Better QualityIt’s good for the planet, your finances, and your Marie Kondo-ed wardrobe – make sure you buy the best you can afford, but much less often. Discover the joy of less and quality items and realise that cost per wear is the crucial metric – that sale bargain isn’t a bargain if you only wear it once.