How to Manage Finances in your 20s

In your 20s, you may be juggling jobs, education, and relationships, but it’s wise to make sure your financial health is also being cared for. By starting with smart choices now, you can boost your comfort and success in your 30s and beyond. 

Make a Plan

A healthy and successful financial life starts with a plan. Think about where you see yourself in the next few decades. Do you prefer to rent or buy a home? What do you want to achieve in life? How are your finances going to help you get there? These answers will be different for everyone, so get clear on what drives your unique goals. 

Establish A Budget

Clear budgeting is needed for the best future outcome. It helps you live within your means and avoid overspending. First, write down all of your daily expenses and recurring payments like rent, food, and transportation. Then, note your smaller and larger savings goals. A short-term fund of at least 3 months of rent is ideal for emergencies like a job or home loss. It can also include debt repayment plans, as this is a top priority. Long-term funds like retirement or a home purchase can be counted separately. 

Regularly check in with your monthly budget and find ways to cut down where you can. Even saving an extra $100 from takeout and funneling it into your savings can make a huge difference in a year. 

It’s also important to stay organized and leave a paper trail when you can. Using checks can help you track your purchases, especially large ones. Plus, you can personalize them by choosing collegiate checks that support your favorite team or other fun designs. 

Build Your Credit

Monitor and build your credit score during your 20s if you’re looking to gain trust for bigger purchases or loans later on. Paying off your debt on time will help you build a higher score. Generally, a score over 720 can make borrowing in the future a lot more stress-free.

If you don’t have any debt, you may want to consider getting a credit card to slowly build up your credit over time. Just make sure to not overspend and dutifully pay off the balance each month. 


There are a lot of options for investment in this exciting decade of life. You may want to read financial books or listen to podcasts describing your options before deciding what is best for you and your budget. Starting small is typically better than avoiding investments all together. You can gradually increase them over time, with the end goal that your money starts working for you.

A common smart investment for your 20s is to build up a savings account or 401k if your employer offers it. If they don’t, try to save around 15% of your income. If that’s too high, save as much as you can until you can comfortably hit this percentage. Don’t think of it as losing money, but rather paying yourself when you really need it! 

You can also find ways to invest in yourself. Discover new talents, hobbies, and interests. Branch out and network with people involved in your passions. You never know when these skills may prove beneficial. 

Cultivate Self Control

Start learning to shop smart. Go into the grocery store with a list and stick to it. Find deals online in your local shops and take advantage of them. Resist impulse purchases, and try to always sleep on it before deciding on a large purchase.

By checking in with your budget every single month and setting reminders of your goals and investments, you can be much more relaxed and prepared for the decades to come.