Financial Planning for Young ProfessionalsSubmitted by Younity Wealth Partners on June 19th, 2017
Updated: June 19th, 2017 by Kara Downing, CFP®
You’re 25 and feeling alive. You’re settling into life after college, paying off your debts, and slowly figuring how to “adult”. But with the responsibility of bills, rent, and even keeping up social appearances, prioritizing financial planning is something far too often pushed to the side. Of course, the nagging idea that maybe starting a 401-K might not be the worst thing, however it’s hard to fully take control of your financial future when the reality of everyday life is living paycheck to paycheck.
But 25 is often touted as the true coming of age, when financial planning, and the financial responsibility that comes with it, allows for the doers to turn dreams into reality.
And just like in life, financial success often lies not in setting solid short-term and long-term goals, but actually developing a plan to accomplish them. o when the sudden transition to adulthood hits you like a ton of bricks, what should you do? All cheesy metaphors aside, success lies in your greatest investment - YOU. This is the perfect time for you to invest in your skills and experience to develop and maximize your earning potential. Financial ‘fitness’ is resonating with young professionals more than ever. According to the Young Adults & Money Survey by Schwab MoneyWise, “two-thirds of young adults say financial fitness is more important than physical fitness, and the majority believe that financial education in school, grades K–12, is more important than both physical education and health education combined.”
So, what else can you do to get your finances in tip top shape?
- Respect the power of monthly budgeting. Deciding what’s a necessity versus what’s a ‘nice to have’ could be the difference between affording that down payment on your first property or not.
- Tackle debt head on. Be realistic when assessing the debt in your life and budget accordingly. The sooner you pay off debt, the more stable your future could be.
- Set aside money from each paycheck for retirement. It’s never too early to start thinking about it. If your company has a sponsored 401(k) or other retirement plan available, make sure you contribute the minimum amount that will allow you to take full advantage of any employer match.