Your twenties are so important, well at least the book – The Defining Decade by Meg Jay – says so. It’s important to get your life together or being on a journey to, when you are in your twenties.
This is the time when, I assume, you are done with university and are working towards your life goals and we all know getting your financial life together helps you in one way or another in achieving those goals.
With that in mind, here are 5 smart financial decisions you can make in your twenties.
1. Pay your debts
Or start to pay your debts.
This can be your student loans or any type of debts that you have. I once on a guy on a radio say, ‘If you are in debt, the money you own is not yours’ and that stuck with me. Living debt free is so liberating, at least that’s how those who are debt free explain it to be. And if you pay loans, you are in a good place to use your future hard earned money on investments.
If you are in debt, the money you own is not yours.
2. Buy land
Owning land is an investment that pays back, whether you build and rent the space or start faming and selling the produce.
The value of land keeps on going higher every year, and so owning land sooner and as many as many as you can pay well in the future. And when is the best time for you to do this than when you just started working and having few responsibilities also known as your twenties?
3. Save
Whether it’s for retirement or emergency, just save.
All of us learned this lesson last year when Corona hit and businesses were closing, we all saw how important it was to not live our lives waiting for the end of the month, because life is unpredictable and anything can happen. And so saving, especially in your twenties, as soon as you can, can help you be financially secure in the future or when the unthinkable happens. Get started, no matter how small. Just save.
4. Start a business
Side hustle is important, having multiple sources of income is the smartest way to live in today’s world.
Start that business that you talked about last year, now you have time, energy and the money to. Invest the money wisely in business so that it can multiply. Take risks in your twenties, you are still young, you don’t have much to lose but a lot to learn.
5. Live on a budget
Most people respond to money, they don’t have plans on how they want to spend their money.
In your twenties especially there is a lot of ‘temptations’ and so many trends that you can spend your money on, make sure you live on a budget, live within your means and avoid peer pressure when it comes to using your money.
Your twenties can be used to build, can be used to create a foundation of how the rest of your life will be, so invest this time in your personal and financial development. And please read the Defining Decade by Meg Jay, you are welcome.
Further reading:
- Budgeting for Teens (Money Under 30)
- 8 Financial Tips for Young Adults (Investopedia)
- I Wish I Started To Save Earlier After Seeing This Chart (Lifehack)
- Reaching the Next Generation of Financial Services Customers in Africa (CGAP)
- How to think about a self-financing emergency fund (Vijana FM)
