5 Money Saving Tips for Young Adults

When you’re young, saving money can seem like an impossible task. It’s easy to see your paycheck as a way to get by month to month and not a way to prepare for the future and save for financial difficulties. But putting just a little money aside each month can make a world of difference. These five money saving tips for young adults can help you get started on the path to future financial success.

Five Ways to Save Money as a Young Adult

1. Make a budget. You’ve heard it before. Creating and sticking to a budget is one of the best ways you can save money. Making a budget doesn’t mean you have to give up fun for the rest of your life. By creating a budget, you’ll be able to see where your money is going each month and allocate funds to saving, bills and entertainment. Try using this simple budget worksheet from Money Under 30 to get started.

2. Don’t wait to save and invest. Saving and investing may seem like a challenge right now, but putting away just a few dollars a week can have a big impact. Use your budget to see how much money you can put into your savings account each month. And as for investing, if your employer offers a 401(k) account, U.S. News recommends contributing just 2% of your salary and increasing it as time goes on. 

3. Save one-third of your income. If you aren’t sure how much you should save, U.S. News also recommends saving one-third of your income if you can. By saving $1 out of every $3 you earn, you are making it easier on yourself to survive future financial difficulties, such as layoffs, car repairs and other surprise expenses. 

4. Start an emergency fund. Another good way to save for financial hardship is to start an emergency fund. Investopedia recommends putting some money into a high-interest savings account, CD or money market account.

5. Pay off your debt. While putting money into savings is a good way to prepare for your future, you should also be concerned about paying off your debt. You should be aggressive about paying off your debt and careful not to let your credit cards spiral out of control. 

For more money saving tips for young adults, check out First Bank’s* online Financial Education Center.


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Sources:

Money Under 30: http://www.moneyunder30.com/really-simple-budget-worksheet

US News: http://money.usnews.com/money/personal-finance/articles/2010/10/12/6-best-money-tips-for-young-people

Investopedia: http://www.investopedia.com/slide-show/financial-tips-for-young-adults/?article=1

My Bank Tracker: http://www.mybanktracker.com/news/saving-tips-for-young-adults