Young adulthood is often equal parts transformative and financially strenuous. This is particularly true when wages are stagnant and cost of living is high. With many young adults constantly struggling to make ends meet, saving money is liable to seem like a harrowing prospect. While it’s true that building one’s savings can be difficult, a large percentage of young adults possess more saving power than they realize. When it comes to saving money during young adulthood, the following tips can help steer you in the right direction.
1. Be Mindful of Your Food Costs
It’s easy to see why so many young adults prefer dining out to preparing their own meals. It’s convenient, it’s easy and there’s no cleanup. However, despite all the positives, frequent restaurant visits can rapidly deplete one’s finances. With this in mind, make a point of regularly preparing your own meals. For many people, this will be a huge adjustment, but after a few weeks have passed, the amount you’ve saved on food costs will likely inspire you to continue being your own chef. This isn’t to say that you can never go to restaurants, but you should limit dining out to once per week. In addition to helping you save money, this will make your restaurant visits feel a lot more special.
Since it’s never too early to start thinking about retirement, consider putting the money you save into a high-interest savings account or Roth IRA. If you’re interested in the latter, this Roth IRA calculator is sure to come in handy.
2. Opt for Staying in Over Going Out
A night on the town can be a great way to cut loose and enjoy the company of your favorite people. When engaged in too often, however, nights out can be financially draining. As is the case with dining out, moderation is key when hitting the town with friends. Limiting the number of outings you embark upon each month and opting to entertain yourself at home can be a tremendous boon to your personal finances. Additionally, staying home doesn’t mean you can’t hang out with your friends. For example, movie nights and game nights are both fun, cost-effective ways to get together with pals, neighbors and family members.
3. Recognize the Importance of Paying Off Debt
You’d be hard-pressed to find a young adult who isn’t in debt to some degree. Of course, this isn’t to say that every young adult is equally serious about getting rid of their debt. The more debt you accrue, the more interest you pay – which ultimately makes it harder to get a handle on the debt. When it comes to paying off outstanding debt, sooner is almost always better than later, so when tending to your monthly expenses, pay special attention to student loans and credit card bills.
Although many people look back on young adulthood fondly, there’s no denying that it can be a financially tricky period in one’s life. Since many young adults are saddled with student debt and dealing with a heightened cost of living, putting away money for the future is liable to seem impossible. However, saving money during young adulthood doesn’t have to be an uphill battle. Armed with the pointers discussed above, young adults can effectively build their savings in a timely manner.