5 Financial Habits to Master Before 25

Are you looking to set yourself up for financial success before the age of 25? We all know that money management is important, but it can often seem overwhelming and intimidating. To make things easier, we’ve created a list of five essential financial habits that will have you mastering your finances in no time. This video covers the top tips on how to establish smart spending habits, manage your budget effectively, save more money over time, and ultimately set yourself off for future success with your finances. So, let’s get started – it’s never too early to invest in a brighter financial future.

Video Transcript:

Hello everyone, my name is Sam DiSette and I’m one of your MoneyNav financial coaches. Today, we’re going to be talking about the five essential habits to master before you turn 25 and as one of the coaches that falls into this age category, I find myself using these habits as well. The first thing we’re going to talk about today is budgeting.

One key term we like to use in our discussions is “controlling your money” and not letting your money control you. Another way of putting that is finding a way to show your inflows and your outflows to make sure the money is not taking effect on you and you’re still able to do the things that you want to enjoy while also being able to save.

The second piece that follows that is contributing to your 401(k). Maybe you guys have just started working at your first job or have never had a 401(k) available to you. A good piece of information when you first start working is to find out if a 401(k) is available to you at your work. If so, are you contributing pre-tax or Roth?

That can be an important question to ask in terms of the way the taxes work inside the 401(k) plan. The third thing we’re going to talk about today is emergency savings. On our hierarchy scale, we like to put emergency savings below making sure that we have three months of savings set aside for any unexpected expense we might run into.

Whether that might be the roof needing to be repaired, or a car breaking down, whatever that may be, make sure you have money set aside that it’s available for you. One thing that’s important to note is that getting money out of your 401(k) can be very difficult, so making sure that you have enough savings set aside is a very important topic.

The fourth thing we’re going to talk about is establishing credit. Maybe you just got out of college and you’re looking to buy your first home. Establishing a good line of credit and making sure that you’re paying off your credit card debt in a timely manner is an important way of getting good credit.

And that will help with either where you’re purchasing a home or where you’re trying to finance your first car. Our last item is student loans. Student loans can be a very worrisome topic for many individuals coming out of school. So, making sure that you have a good plan in place to pay off those student loans is important.

Recently, we’ve done a few topics on snowball versus avalanche, which are two different ways of paying down debts. I hope you guys found this information today valuable. Again, there are references in MoneyNav and a lot of resources that we have available to you guys. Remember, if you have the contact information for your advisors, be sure to reach out if you have any questions. Take care and have a great rest of your week!