Stay Ahead of Law Changes & Protect Yourself Against Being Audited: Corporate Transparency Act and Reasonable Compensation

Personal Finance Tips for Young Adults

As someone who has been working for most of their life, I wish there was someone out there who had shown me the correct way to save money for my future. Now that I am in my 30s, I have been getting better at saving money, but there are some personal finance tips that I am looking at now, that I wish I’d known earlier so I could have put them into practice sooner. 

The best time to start thinking about your savings is right when you are getting to graduate college and start your career. If you decide not to go to college, once you get a job, you should think about your savings for the future. There are many big purchases in the future that a young person must consider: savings, such as, weddings, children, purchasing a home and retirement.  

According to WCNC Charlotte, here are 5 money saving tips that all young people should consider to have healthy personal finances.  

  • Social Security Number is sacred
  • Don’t just buy the brand, buy the stock
  • Start investing as soon as possible
  • Save 20-30% of your paycheck
  • Have a plan to reset debt

Now let’s dig into these deeper. 

Social Security Number is Sacred

When you are born, you are assigned a social security number from the government. This number is used for many things throughout your life. Your credit is also tied to your social security number. You want to make sure that no one ever gets access to your social security number. If you want to get credit cards, a car, a house, they will pull your credit score from your social security number. If anyone gets access to your social security number, they can use this information to open accounts that you did not give permission to. In order to protect yourself, make sure you are not giving out your social security number to everyone, only provide it when absolutely necessary. 

Don’t just buy the brand, buy the stock

Every time you buy a brand name, you give free advertising to that company. Wouldn’t you like to see some of that money come back to you? Think of looking into purchasing stocks with the most popular brands: Nike, Apple, Disney. If you ever decided to sell your shares, you will get some money back. At least now when you use/wear that brand, you can do so knowing that you are making some money while doing so. 

Start Investing as soon as possible 

A common myth is that you need to have a lot of money to start investing. This is not true. You can start an investment with as little as $1. Look into robinhood.com and you can see all that you invest into. A good thing to remember is that stocks can go up and down, make sure that if you are going to invest in stocks, that you have someone that can assist you should you have any questions. 

Save 20-30% of your paycheck 

You want to build a savings account for anything that you may need in the future. Some personal finance experts say that you want to build a savings of about 6 months to ensure that if you were to lose your job, or run into serious health issues, you are still able to pay bills and survive since you have your savings to fall back on. You also want to consider building the savings for the larger purchases that you plan on making in the future. You can save for a car, a house, your wedding, future children, their education, and even your own retirement. When you go to the bank to open your checking account, you should also open a savings account. The best way to make sure that you have the money going into your savings is when you are setting up your payroll at your job, you request a certain amount of money to go directly into your savings account. You can also look into a High Yield Savings account that will continue to grow for you as you add money to the account. 

Have a plan to repay debts 

If you had to take loans out for college, you want to make sure that you can pay back the loans in a timely manner. You want to make sure that you can find a job where you are able to set some money aside to make the payments for the loans that you borrowed. You also want to keep in mind that you do not want to borrow any additional money until you have paid back at least half of the amount of the loans that you needed to borrow. In doing so, this will also help your credit, which again, is tied to your social security number. 

Now let’s talk about budgeting. Budgeting is something that I struggled with in my 20s, but I am now making sure that I discuss my budget with my husband, and we try our hardest to stick to it. I recently read an article on mint.com which gave many additional tips on budgeting and money management, but there is one thing that stood out to me that I wanted to discuss further. That is the 50/30/20 rule. This is something that I am slowly adapting to in my personal life, and I think this is a great tip for a young person. 

What is the 50/30/20 Rule?

To put it in simple terms: 50% of your income will go to essentials, such as bills/expenses that need to be paid each month (housing, car, food, etc.). 30% of your income can be used towards your wants that month (coffee runs, date nights, etc.). The remaining 20% of your income should be put into savings. This will help build that savings account that we discussed earlier and you will be able to use the money as needed for emergencies. 

How to learn about Personal Finance

Should you have any additional questions on building your savings and how to complete your taxes, especially if you just got your first job, please give us a call at 281-440-6279 and someone from our office would be more than happy to assist you with any questions you may have. 

The Molen & Associates Difference

Mike Forsyth

“Super helpful and timely. This is our first year with them and we look forward to trusting them with our taxes and business books for years to come.”

Caitlin Daulong

“Molen & Associates is amazing! They run an incredibly streamlined process, which makes filing taxes a breeze. So impressed with their attention to detail, organization, and swift execution every year. Cannot recommend them enough!”

Sy Sahrai

“I’ve been with Mr. Molen’s company for few years and I felt treated like family respect and dignity. They are caring, professional and honest, which hard to find these days. Love working with them.”

Tax Tips for Newlyweds

Tax & Financial Tips for Newlyweds in Houston Marriage is a significant milestone that not only unites two individuals in partnership, but in most cases, also merges their financial and tax situations. For newlyweds in Houston, understanding the tax implications...

Self-Employment Taxes: A Deeper Dive

Self-Employment Taxes: A Deeper Dive Self-employment taxes are a critical component of the tax system in the United States, impacting individuals who work for themselves. Understanding the nuances of these taxes can help self-employed individuals plan and manage their...

Education Tax Benefits: Maximizing Savings with Credits and Deductions

Education Tax Benefits: Maximizing Savings with Credits and Deductions Navigating the complexities of tax season can be daunting, but for those bearing the costs of higher education, there are valuable tax benefits that can ease the financial burden. Among these are...

How to request Individual Penalty Abatement

How to Request Penalty Abatement Penalty abatement is a great way to help reduce your client's tax debt. Here's how you can request apenalty abatement from the IRS. Let’s say you’ve determined that your client is eligible for a penalty abatement to help reduce their...

Understanding the Child Tax Credit for 2023

Understanding the Child Tax Credit for 2023 The Child Tax Credit (CTC) is a significant provision in the U.S. tax code designed to offer financial relief to families with qualifying children. As we navigate the 2023 tax year, it’s crucial to understand the current...

Tax-Smart Strategies to Pay for College

Tax-Smart Strategies to Pay for College   As the cost of college continues to rise and inflation soars, families are looking for ways to make ends meet. One way to do this is by taking advantage of tax breaks that can help offset the cost of tuition and other...

Unlocking Financial Freedom: The Strategic Power of Revoke-S Elections

Unlocking Financial Freedom: The Strategic Power of Revoke-S Elections As a small business owner, you understand that time, money, and peace of mind are precious commodities. The world of taxes can often feel like a labyrinth of complexities, with ever-changing rules...

The Augusta Rule: A Comprehensive Guide to the Section 280A Deduction for Small Business Owners

As a small business owner, you’re likely familiar with the home office deduction. This popular tax break allows you to write off up to 300 square feet of workspace in your home at a rate of five dollars per square foot, resulting in a potential $1,500 annual...

Unleashing the Mega Backdoor Roth: Maximizing Your Retirement Savings

Unleashing the Mega Backdoor Roth: Maximizing Your Retirement Savings Embark on a financial adventure with us as we introduce you to the not-so-secret world of the Mega Backdoor Roth – the financial strategy that's not only powerful but sounds almost as charming as a...

Get Organized and Sail Smoothly with a Family Tax Firm

How to Get Organized and Sail Smoothly with a Family Tax Firm? Tax season—an annual event that can trigger a range of emotions, from anticipation to anxiety. For small business owners, the prospect of tackling complex forms, deciphering intricate regulations, and...

Request an Appointment Today

9 + 9 =

Call us at

Pin It on Pinterest

Share This