Five Personal Finance Moves to Make Before You are 30

Managing money effectively is more important than making money because financial stability is more of a function of how you manage your money than the size of your paycheck. You’ll find some folks struggling with their finances today despite the fact that they have good jobs and are drawing good salaries; yet, you’ll find others getting by financially with lesser salaries and you start wondering why more money doesn’t necessarily translate to more financial stability.

I have also observed that educational qualifications don’t necessarily have a direct impact on a person’s financial acumen. Age also doesn’t confer financial wisdom on people because many older folks could still be caught making financially wrong decisions. This piece provides insights about five personal finance moves you should have made before you clock 30.

1. Build an emergency savings fund

The first personal finance move you should make once you are working is to build an emergency savings fund. An emergency savings fund is a rung higher than your regular savings account on the pathway to financial stability. The funds in your emergency saving account can save you from being dead broke or getting into debt when the Murphy’s Law comes to play on your finances. Ideally, you have at least 3 to 6 months worth of living expenses in an emergency savings funds in case the worst happens and you lose your job.

2. Master the art of budgeting

A budget is a great tool for managing your finances and putting financial stress at bay. Creating a budget helps you to make conscious decisions in prioritizing your expenses. A budget also helps you know when you are likely to run out of money before the month ends so that you can find ways to cut your expenses or increase your income. Without a budget, you’ll most likely be making rash spending decisions on things that catch your fancy.

3. Start using automated savings

Before you are 30, you should have outgrown the “you only live once crowd” and start preparing for the future by saving money ahead. Saving up towards big expenses is smarter than making sudden purchases that cause other aspects of your finances to suffer. Many people spend their income on things that catch their fancy in the sincere hopes of saving what’s left over at the end of the month. You should consider automating your savings so that you are ‘forced’ to save first, you can then spend the rest as you deem fit.

4. Paying off/down debt

Most people set off with a financial handicap in life because of debt. You’ll most likely leave college with an amount of student debt, you’ll probably have some credit card debts to your name, and you probably bought your first car with some financing. However, you should start making a conscious effort to tackle your debt before you clock 30. You may want to prioritize paying off high-interest debt first so that you can have more money to apply towards other things. If the debt is already overwhelming, debt consolidation is a smarter alternative than ignoring the debt and living in denial.

5. Know how to negotiate better deals

The art of negotiation could save you more money and help you get more value out of each dime you spend. Many people are not comfortable with negotiation because they are scared that it will make them look cheap or not well off enough. However, negotiation has its place in practically all transactions because negotiation ensures that both parties to the deal find a fair value. Negotiation is not always about getting low prices. The art of negotiation can help you get concessions; value added services or even an extended warranty.

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Victor Alagbe is a seasoned business and finance writer with a specialty in writing about how to invest for the long-term in healthcare, pharmacology, energy and tech stocks. His long-term focus is on stocks that provide a nice mix of growth and income. For the short term, he passionately writes about trading stock options for the excitement and leverage that stock options offer.


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