Save
Three important money habits to start in your 20s
Twenty-somethings who immerse themselves in financial education and budgeting strategies are on the right path towards building wealth and a comfortable retirement, says financial planner Zuraida Ariffin of Zuraida Ariffin Wealth Creation.
Three important money habits to start in your 20s
Twenty-somethings who immerse themselves in financial education and budgeting strategies are on the right path towards building wealth and a comfortable retirement, says financial planner Zuraida Ariffin of Zuraida Ariffin Wealth Creation.
According to 2017 research by CommBank, 53 per cent of Australian households are expected to have enough for a comfortable retirement from their combined superannuation savings, personal assets and the age pension.
When the age pension is removed, the number of households that can afford a comfortable retirement reduces to 17 per cent, and to just 6 per cent when the calculations are based on superannuation only, the research showed.
Speaking to Nest Egg, Ms Ariffin said there are three important money habits that 20-year-olds can start right away and will help set them up for financial wellness in the future.
Start reading
According to Ms Ariffin, 20-year-olds can start their journey by filling their minds with positive money-saving ideas.
“Learn the art of making your income spread to your budgetary needs. Dedicate 15 minutes daily to put yourself ahead of finances and to gain financial literacy,” she said.
“Invest in books on budgeting and how to save money. Each author has a different approach, so choose one that fits you. Armed with the knowledge, create a budgeting system that suits you.”
Ms Ariffin added that immersing yourself in financial education will also help drown out the negative money habits that are promoted elsewhere.
“Minimise the impact of negative influences from your environment relating to money, such as advertising and people. Be aware of messages that entice you to spend, spend, spend. These can derail your aims,” she said.
Start tracking
Once you understand the concepts of saving money, Ms Ariffin urged 20-year-olds to begin tracking their income, expenses and savings.
“Accumulate your money in a separate bank account marked ‘Do not touch’. Set your saving goals small and work your way up. Save a specific amount of money regularly. All you need is a simple spreadsheet or find an easy to use app, of which there are many,” she said.
“Tracking your savings is where the ‘rubber meets the road’. This is proof of what you are able to save in a week, month or year. It’s not what you earn, but what you save that will determine the level of wealth you will have in the future.”
Make a plan
Finally, twenty-somethings can start accumulating wealth right away by having a financial plan. Ms Ariffin recommends investing some of the money you saved into a diversified investment portfolio.
“You may wish to engage a financial planner to create a strategic financial plan and work with you on an on-going basis,” she said. “The financial plan is important for you to be able to evaluate what your portfolio could potentially be worth in five or more years. Your financial adviser would be able to model your potential portfolio value at various times in the future.”
Expenses
A cashless society could be closer than we think
If Australia was to go completely cashless tomorrow, more than half of Australians would be comfortable with the idea, new research has revealed. ...Read more
Expenses
Major airline finally offers refunds for cancelled flights
The ACCC has welcomed an airline’s decision to provide refunds to all Australian consumers who have not been able to fly due to the COVID-19 pandemic. ...Read more
Expenses
Will cash go the way of the dinosaurs post-COVID-19?
More than a third of Australians have declared they will use cash less often or not at all after the pandemic, according to new research. ...Read more
Expenses
‘Big stick’ energy laws in full force
Australia-wide regulations that ensure cheaper electricity costs are passed on to customers and hold energy companies to account for manipulation and misconduct are now in effect. ...Read more
Expenses
Government to repay $721 million generated via robo-debt
The government has indicated that it will be taking steps to refund $721 million from 470,000 debt notices – affecting 373,000 Australians – raised wholly or partially through its controversial ro...Read more
Expenses
How falling coffee prices will impact your local cafe
Australians are ditching their coffees on the way to work, with the morning brew becoming an unlikely victim of the COVID-19 pandemic. ...Read more
Expenses
Donor hopes dashed: How $51 million in bushfire relief can be spent
Comedian Celeste Barber’s mammoth $51 million fundraising effort will remain in the hands of the NSW Rural Fire Service despite a push for donations to be split among state services still reeling fr...Read more
Expenses
The quicker and cheaper way to finalise a divorce
A growing number of separating couples are turning to private courtrooms to fast-track their divorce property settlements at a more affordable cost, according to a law firm. ...Read more
Expenses
A cashless society could be closer than we think
If Australia was to go completely cashless tomorrow, more than half of Australians would be comfortable with the idea, new research has revealed. ...Read more
Expenses
Major airline finally offers refunds for cancelled flights
The ACCC has welcomed an airline’s decision to provide refunds to all Australian consumers who have not been able to fly due to the COVID-19 pandemic. ...Read more
Expenses
Will cash go the way of the dinosaurs post-COVID-19?
More than a third of Australians have declared they will use cash less often or not at all after the pandemic, according to new research. ...Read more
Expenses
‘Big stick’ energy laws in full force
Australia-wide regulations that ensure cheaper electricity costs are passed on to customers and hold energy companies to account for manipulation and misconduct are now in effect. ...Read more
Expenses
Government to repay $721 million generated via robo-debt
The government has indicated that it will be taking steps to refund $721 million from 470,000 debt notices – affecting 373,000 Australians – raised wholly or partially through its controversial ro...Read more
Expenses
How falling coffee prices will impact your local cafe
Australians are ditching their coffees on the way to work, with the morning brew becoming an unlikely victim of the COVID-19 pandemic. ...Read more
Expenses
Donor hopes dashed: How $51 million in bushfire relief can be spent
Comedian Celeste Barber’s mammoth $51 million fundraising effort will remain in the hands of the NSW Rural Fire Service despite a push for donations to be split among state services still reeling fr...Read more
Expenses
The quicker and cheaper way to finalise a divorce
A growing number of separating couples are turning to private courtrooms to fast-track their divorce property settlements at a more affordable cost, according to a law firm. ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.