Financial Planning
Written By Amanda Center
Time is your best friend when it comes to financial planning. The earlier you start prioritizing financial wellness and planning, the better off you will be in the future. However, to be able to prioritize financial wellbeing you need to have an initial education about personal finance. As of 2022, only 23 states in the U.S. require students to take a personal finance course to graduate from high school. Taking the time to learn about personal finance can help young professionals throughout their life. Learn more about wealth management strategies for young professionals to secure their future.
#1 Make A Budget That Works For You
To ensure you are not living above your means, you should build a monthly budget that works for you. Start by analyzing your spending over the past several months to get an understanding of your spending habits. This will allow you to see how much you are spending and what areas you can cut back on. Once you have set your budget to include your expenses, needs, and savings, it’s time to start sticking to it! A budget is meant to be an outline of what you should be spending each month.
If your spending starts to outgrow your budget, you can adjust your budget to your needs.
#2 Save For Retirement Now
Even though retirement is decades away, you need to start saving for retirement as early as possible. The more time your retirement funds have to compound interest, the larger nest egg you’ll have when it is time to enjoy your golden years. If your employer offers any employee match when contributing to their employer-sponsored retirement account, take advantage of it. If you are not contributing the minimum amount for the match, you’re leaving free money on the table.
#3 Start An Emergency Fund
Unfortunately, accidents and emergencies happen. Depending on the cost of the incident, it could end up forcing you to clear out your bank account or go into debt. To help prevent experiencing financial hardship due to an emergency, begin building an emergency fund. An emergency fund should be three to six months’ worth of expenses. It’s important to keep your rainy day fund separate from your regular checking account, so utilize a high-yield savings account, certificate of deposit, or money market account to keep earning on your savings.
#4 Build Your Credit Score
Your credit score will allow you to borrow funds from lenders and the higher the credit score, the lower the interest rate. It’s important to stay up to date with your credit score to ensure that you are in a good position to apply for debt when you need to. The best way to improve your credit score and keep it high is to make your payments on time, keep your balances low or zero, and check your credit report for any debts that are not yours.
#5 Be Smart With Debt
Debt could be holding you back from putting savings away and reaching other financial goals. Prevent yourself from accumulating consumer debt, such as credit card debt, that comes along with high-interest rates. While it may be fun to spend on luxuries, minimum payments where you barely pay off on the principle can eat up your budget. If you have a large amount of student loans, consider refinancing for a lower interest rate. No matter what debt you have, having a plan on paying it down and keeping it low is key to reaching your financial goals.
As a young professional, you want to start your adult life off by prioritizing your finances. To help you build financial wellness, enlist the help of a knowledgeable and trustworthy financial advisor to help you reach your goals. Our advisors at Mooney Lyons will help guide you through the financial planning process throughout your life and ensure you are working towards your financial goals. Schedule a consultation with us today to get started.
Sources:
https://zagmoutcpas.com/7-must-follow-financial-strategies-for-young-professionals/
https://www.investopedia.com/articles/younginvestors/08/eight-tips.asp
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We are a financial advisory firm, wealth management firm, asset management firm based in South Barrington, Illinois and servicing the Chicago area offering retirement planning, investment consulting, financial planning, business valuation, ESOP consulting, estate planning and more.
Areas of practice: ESOP consulting, Financial solutions for business owners, Business exit strategies, Business succession planning, Maximizing business value, Investment strategies for blue collar industries, Tax planning for business owners, Risk management for businesses, Estate planning for business owners, Business asset protection, Retirement savings for business owners, Business owner financial advice, Business owner insurance planning, Financial security for blue collar entrepreneurs, Wealth management for business owners, Financial planning for blue collar businesses, Exit strategies for business owners, Succession planning for blue collar businesses, Retirement planning for business owners, Investment management for small business owners, Estate planning for business owners, Business valuation services, Tax planning for blue collar businesses, Risk management for business owners, Employee benefit plans for business owners, Wealth preservation for blue collar businesses, Business sale and transition planning, Legacy planning for business owners, Financial security for business owners, Customized wealth management solutions, Investment consulting, Financial planning services, Financial advisor, Estate planning, Insurance planning, Investment strategies, Financial solutions, Retirement strategies, Wealth preservation, Financial experts, Retirement advisors, Investment management, Financial guidance, Financial services, Comprehensive financial planning, Financial advisory, Wealth management, Retirement planning, Investment consulting, Financial planning, Financial services, Estate planning, Tax planning, Insurance services, Financial advice, Retirement strategies, Investment management, Financial solutions, Financial goals, financial advisor illinois, financial planning illinois, financial planning services, wealth management for business owners, financial planning for business owners, exit planning for business owners, exit strategies for business owners, business exit planning, business exit strategies, investment strategies
Amanda Center
