Gen Z in their 20s has been at a stage of life to build their careers and even start a family. To pass this stage, of course they must have a good financial management strategy to have a brilliant financial condition in the future. Dear Gen Z, here are 7 tips you can do to manage finances:
- Build an emergency fund
This emergency fund is quite important for you, remembering that there will be urgent conditions when you need these funds, like medical emergencies. The best way to keep an emergency fund is in the form of a low risk investment instrument that is easy to liquidate, such as a savings account. For the first time, start to allocate your 2% of salary funds for 6 months.
- Make a down payment to save
If you plan to own a home, set aside your money to make a down payment or DP for the home you want. Usually, the amount of DP is relatively low, or at least 20%. However, the bigger the DP the lower the mortgage you will pay.
- Set up a retirement fund
The key to having enough money for retirement is to start putting money away in a retirement account early, and continue to do so regularly until you retire.
Read also : Kakeibo, Japanese Method to Saving Money for Your Better Financial
- Avoid Debt
If you already have debt, start managing it wisely. You can take time to create a payment plan, so you can get out of debt. You can also take advantage of financial management software or apps to help you become debt free fast.
- Start Investing
If you have the desire to increase your wealth, you can invest some of your money in several investment instruments. The key to successful investing is to diversify your portfolio. You can do this by holding a mix of assets (stocks, bonds, and cash, etc.), and spreading your money across a variety of investments across a variety of industries.
- Focus on your career
The 20s is the perfect time to build a solid career. Take your time to create a solid professional network and consider all available options.
- Get used to saving
Start to reduce your expenses and save the money in savings. You can create a budget to put money into essentials as well as set aside money for savings.
