When you know how to spend money properly during your teens, you’ll likely prevent having financial problems in your adult years. So, it is best to learn frugality at a young age. If you’re a parent or a teenager right now, read on to know a few bits of money advice for young adults under 25.
Save a Part of Your Income and Earn From It
Whether you have a part-time or a full-time job, you’ll earn an income on a regular basis. Make a habit of saving around 10% of your income and deposit it in a bank. Many banks, such as Frandsen Bank & Trust, offer savings accounts to individuals as young as 15 years old. More importantly, these banks provide as much as 3% annual percentage yield (APY) so you’ll see your savings grow as years go by.
Use Credit Card Wisely
With the “enjoy now, pay later” idea that comes with credit cards, it seems easy to swipe and purchase anything you want. But many people don’t realize that falling into this trap can take a toll on their finances for years. So, it is essential that you learn how to use your credit cards wisely. Always make sure that you pay back what you owe before its due date. Failure to do so means you’ll incur interests and other charges that you have to pay on top of the amount of money that you spent.
Pay Off Your Student Loans Early
Once you have a healthy bank account, start paying off your student loans. It is ideal to pay off student loans as early as possible; the longer you delay it, the higher the interests will be. So instead of spending on unnecessary purchases after graduation, start paying off your cheapest student loans first.
By following these three pieces of advice, you won’t only learn to spend your money properly, but you’ll also develop good money-handling habits that could help you have better financial plans for the future.