Planning Your Financial Freedom: 15 Tips for Young Adults

Getting your financial life started is a crucial step towards becoming an adult. Figuring out how to get started, however, can be tricky. As you get started living on your own, be sure to follow these fifteen tips.

1. Get renter’s insurance. This coverage only costs a few dollars a month, and it’s the best way to protect everything you own.

2. Consider a roommate. You’ll be able to split the costs of rent and utilities, but it’s only worth it if you like living with the other person.

3. Consider if you really need a car. A lot of single people who live in cities with good public transportation have discovered that a car is more hassle than it’s worth. Ditch the car, and you’ll save on insurance, gas, and a car loan.

4. Buy a cheap car. If you can’t live without one, then make sure you pick a vehicle that you can afford. Until you get yourself stable, you don’t need the aggravation of a large loan or a gas guzzler.

5. Buy a reliable car. For that matter, you don’t need a car that requires a lot of maintenance. You probably can’t afford multiple repairs, and constant break downs mean a lot of missed time at work.

6. Think about your cell phone. While you probably can’t function without it, take the time to review plans from different carriers and find the best deal for you.

7. Watch your food bills. Take time now to learn how to match coupons with sales. If you don’t know how to cook, learn how.

8. Get another source of income. Most people don’t make a lot at an entry-level job. Fortunately, you don’t have many family obligations to prevent you from taking on some side work.

9. Make your student loans a priority. Get them paid on time, and make it a priority to pay them off as soon as possible. The penalties that you incur if you cannot pay them back will haunt you for the rest of your life.

10. Pay off your credit cards. If you have credit card debt, work to eliminate it. If you find yourself frequently shopping for things you can’t afford with your credit card, take it out of your wallet.

11. Get healthy. This is the best time of your life to instill healthy habits. Quit smoking, get your weight under control, and pay attention to your diet. Good health will mean less time off of work and lower health insurance costs.

12. Save for emergencies. Start a savings account and direct a small amount of each paycheck to it. Even an emergency fund with a few hundred dollars can pay for a unexpected car repair or fill in for a few missed days of work.

13. Improve your appearance. Don’t go overboard, but it’s probably a good idea to improve your wardrobe so that you’ll look professional at work. You want to leave a good impression with potential and current employers.

14. Live without premium cable. Keep your bills for extra channels, etc. as low as possible.

15. Start saving for retirement. Yes, it’s decades away, but every dollar you save now will have years to collect interest. Even a few hundred dollars a year can give you thousands when it’s time to retire.