How to Manage Your Money Successfully
Everyone dreams of reaching financial independence at some point in their lives. Of course, we’d like to achieve it sooner than later. I mean, who wouldn’t want to trade a desk job for unlimited cocktails by the beach or having the freedom to travel whenever you would like to, right?
You shouldn’t think of financial freedom as just one big destination, though. Think of it as hitting several smaller pitstops or markers. Although they aren’t guarantees that you will attain financial freedom, they serve as checkpoints to see if you’re on the right track and not getting lost along the journey.
Here are some financial milestones you’ll want to hit in your 20s and 30s to reach financial freedom.
1. Opening a checking account
If you haven’t opened one while you were still in school, hopefully you did this right after graduating. Opening and learning how to manage your checking account is one of the most important life skills to have.
2. Building an emergency fund
Now that you’ve opened a bank account, the next step is to build an emergency fund. The pandemic has shown us that things can change in a flash. No matter how secure you may be feeling now (in terms of your job, housing, finances, etc.), all that can be taken away from you instantly. Having an emergency fund will help tide things over in case of a rainy day. This goes beyond the pandemic. You can use your emergency fund for when your car accidentally breaks down, somebody in your family gets into a medical emergency, or you find that your home is in need of sudden repairs.
Sadly, it’s not enough to save through a bank account. You actually lose a lot because of inflation. In order to truly save enough for the future, you need a way to grow your money faster than it would in a bank. It’s through investing. There are many ways you can invest. You can invest in a health insurance policy to ensure you are medically and financially covered in case something happens to you, you can invest in VUL to grow your savings, or you can even invest in a business venture.
If you want to learn more about how you can manage your finances, be sure to check out our other financial education resources.
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