Many people hold jobs during high school and college in order to have spending money. However, they aren’t required to be fiscally responsible. This changes once a person is out on their own working their first real job. Individuals in this phase of their life likely feel broke. They’re paying bills for the first time and are responsible for providing for themselves.
During the first of your financial life stages it is important to:
Create a Budget
For many people, this is the first time they’ll have real money of their own. It can be tempting to overspend as a way to treat yourself. Be careful. Create a budget that outlines your income and expenses. Once you’ve allocated funds for necessities such as rent, utilities and groceries, then you can determine how much you’re able to spend on non-essential items each month.
Getting into the habit of saving early provides the best avenue for accumulating wealth. You should be saving for both your long-term and short-term goals. Enroll in your company’s private pension plan, if offered, and be sure to contribute enough to get the maximum company match – this is free money! You do not need to put away huge sums of money. By making small contributions over a longer period of time, you will accumulate the wealth you need to be secure in retirement. Setting up an automatic savings plan is an easy way to accumulate funds for short-term goals – including establishing an emergency plan.
Having adequate insurance coverage is important for all of the financial life stages.