Adulting is hard. And as you enter your 20s (or even 30s), you may find yourself struggling to figure out how to manage your money like a bona fide grown-up. Unfortunately, most money matters—like saving for retirement—only get more difficult the longer you put them off.
Here are a few straightforward strategies for financial adulting. How many have you mastered?
Let’s tackle the big one first. If you aren’t already saving for retirement, you must start now. Aim to save 10-15% of your income at the minimum. If your employer offers a 401(k), contribute the max that they’ll match. Sock away the rest in a savings account—and no matter what happens, don’t touch it! Pretend that money doesn’t exist.
If you don’t have a household budget, then what are you waiting for? When you find yourself scrambling to pay bills every month with no idea where all your money went, then you are in dire need of a budget.
Recurring bills like rent are easy to budget for, but don’t forget to include your savings goals and a little cash to treat yo self. Even if it’s just a monthly manicure or a new book, that “mad money” still needs to be a line item on your budget.
There’s nothing quite so satisfying as paying off a debt. You’ll feel a weight lifted from your shoulders. It’s not exactly fun, and I’m sure you’d rather go to the movies or buy a new pair of shoes rather than chip away at your debts. But financial adulting means tackling those boring obligations first.
If you can pay off a debt in a lump sum or within a year of regular payments, make that your top priority. For larger debts, such as mortgage or student loans, try to pay more than the minimum each month.
You may need to live on a lean budget for a few years, but when you pay the minimum, you’re just covering the interest on your loan without ever tackling the principle.
What would you do if your car needed new tires tomorrow? Or if you were hit with a $1000 medical bill out of the blue? Too many of us rely on our family to bail us out of disasters long after we should be taking care of ourselves. In addition to saving for your long-term future, you need to have an emergency account with—ideally—3 months of living expenses at the minimum.
Work your way up to that number as quickly as you can. True financial adulting requires a shift in your mindset from spending to saving. Treat saving as your top priority; if it helps, think of yourself as a collector whose passion is dollar bills.
The toughest thing about being a young adult right now (other than being blamed and shamed for literally everything) is the frustration of being told to save money when you can just barely cover your rent each month.
Look for additional side hustles, sell off stuff you don’t need around your house, and find ways to economize without driving yourself crazy from deprivation.
If that’s still not enough? Start your own business. Learn a new skill and start freelancing. Or do something really radical and change careers to something more lucrative. If you’ve already reached your expense floor—the absolute minimum you can spend and still survive—then the only solution is to earn more money any way you can.