For most, our 20s is an incredibly exciting time. Some have just graduated from college and got their first “adult” job.
In our 20’s, we typically don’t have real responsibilities aside from ourselves, and we’re taking the first steps into our adult life.
Many see this time as the last chapter of freedom before taking on more structured roles and responsibilities (such as parenthood).
However, many fail to see the great opportunity our 20s bring. If done right, we can use this age to establish a solid foundation to bring the life we want for decades to come!
Rookie mistakes in this time are inevitable.
As a financial advisor, the more you help your clients prepare now, the better off they will be in the future.
If you have young clients, or even clients with children the twenty-something age, consider passing on this advice:
According to a 2017 GoBankingRates survey 67% of millennials (age 18-24) have less than $1,000 in savings while 46% have $0.
While not uncommon for the age, it’s clearly a problem.
Let clients know the importance of setting money aside each month to safeguard against emergencies. Suggest automatic deposits to savings accounts or different mobile apps to track savings.
Don’t spend your entire income on a showy place; find something that fits comfortably in your budget so you can save up for something you really want in the future.
Nearly every major credit bureau allows you to report your rent — this is an excellent way to start building your credit.
Good credit is a key to financial freedom. It’s never too early to start building!
A budget is necessary and will help distinguish between wants and needs. Rent is a need while the new Xbox is a want.
When there’s no budget, clients risk under-saving for important events or emergencies while overspending on unnecessary items.
Short term spending is when we spend on socializing.
In the moment it feels good, but maybe spending too often doesn’t make sense or fit our budget for the long term.
It’s great to treat yourself to an awesome restaurant or great show every once in a while, but four times a week can really have an impact on your budget.
When talking with clients it’s important to stress the notion of how organizing their finances as young adults can set them up for life.
It’s also important to remind them that mistakes will happen and it’s okay—it’s much easier for someone with no children or mortgage to pick themselves back up from a financial pitfall.
Have you worked with clients in this age range? What other tips would you recommend? We want to hear from you! Leave a comment below.
If you’re ready to discuss more ways to take your business to the next level, let’s talk. Get in touch with me here.