5 biggest personal finance problems of a 20 something year old
Stuck in a low-paying job?
Credit cards maxed out?
Bought those sneakers instead of saving money, again?
Nodded to all those questions?
If yes, then you’re probably in your 20s & are learning how to handle money.
This might feel a little overwhelming but it’s important to know how to smartly take control of your money.
As a 20 something, here are 5 personal finance problems you might face & how to solve for them:
1. Not having a steady source of income
Having a regular paycheck is like having a warm blanket for your bank account. It has got you covered.
When you don’t have a steady income, it becomes a little tricky to do the basics – budgeting, saving for the future, and managing expenses.
Honestly, it could also lead to other personal finance problems. But here’s how you can deal with this situation:
You can start a side hustle, take on freelance or part-time work to stabilize your income.
Focus on ways to manage your expenses better & only spend on things you really need.
2. Overspending on non-essential items
Let’s say you’re scrolling through Instagram & you see your friends post a story of themselves in Goa. There is a possibility that a travel bug in you is awakened.
Not to forget how easy it can be to book those tickets in one click.
This FOMO (fear of missing out), ease of buying things & craze behind instant gratification usually leads to impulsive spending, leaving you with less money for more important things.
It is essential that you plan & prioritize your spending in a way that you’re able to save for tomorrow.
3. Being in credit card debt
Maxing out your credit cards is as easy as buying things with it! Ironic right?
While it might be stressful to see that piling debt, the most important thing is to navigate your way out of it.
You could start by repaying the minimum amount, converting the outstanding amount into EMIs or even talk to your credit provider, asking for a settlement plan.
4. Not being able to build an emergency fund
Okay let’s recap a little…
You are in a situation where overspending is easy & things are more expensive. Not to forget the possibility of being stuck in a low-paying job.
It is natural to feel that building an emergency fund is difficult.
But the key here is to be consistent with your monthly savings and make it a priority.
You should adjust your spending habits and find creative ways to reduce expenses, because the peace of mind that comes with having an emergency fund is worth the effort.
5. Lack of knowledge on personal finance
Mastering your personal finance skills is as important as learning how to drive or cook. It makes you more independent & helps you make more informed decisions about spending, saving & investing.
It is likely that you did not learn about personal finance because most schools & colleges don’t focus on it.
But there is no better time to start than today.
Make use of trustworthy learning resources, both online & offline.
Sign up for free seminars.
Talk to experts to gain more financial knowledge.
What you need to do is invest some time, have some patience, and get a little help.
You can start here with Zype’s blogs & start learning more about personal finance & money management.
In Conclusion
It is important to remember that you might face personal finance problems as a 20-something year old but with small changes & a little effort you can overcome them.
By acknowledging these challenges & being proactive towards solving these is the first step towards a more secure financial future.
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