Financial Milestones | blog.firstffcu.com

Your 20s are a time of major transitions – you may be graduating from college, starting a career, moving into your own place, and taking on new responsibilities. While the future might feel far away, this is one of the most important decades to lay the foundation for long-term financial health. At First Financial, we’re here to help you make the most of it. Here are some key financial milestones to aim for in your 20s.

1. Build an Emergency Fund

Life in your 20s can be unpredictable. Whether it’s to cover a surprise car repair, medical bill, or job loss – a financial safety net is crucial at all stages of life. Aim to save three to six months’ worth of expenses in a savings account that doesn’t get touched unless it’s a true financial emergency. This emergency fund will offer peace of mind and keep you from relying on high-interest credit cards or loans in a pinch. Start small — automate savings transfers from each paycheck, even if it’s not much at first. Every dollar saved is a step toward financial stability.

2. Strengthen Your Credit Score

A good credit score is your ticket to future financial opportunities — from renting an apartment to getting approved for a car loan. The earlier you start building credit, the better. Make on time payments, keep your credit utilization low, and avoid opening too many new accounts at once. Using First Financial’s First Step Credit Card responsibly is a great way to build credit when you are just starting out.*

3. Explore Additional Income Streams

Looking to boost your savings or pay off debt faster? Your 20s are a great time to start a side hustle or find creative ways to earn extra income. Whether freelancing, teaching a skill online, or starting a small business – building an additional income stream can provide more financial flexibility. Even better, if you can create a source of passive income, like selling digital products or affiliate marketing – you can earn a little extra while you sleep. Find something you enjoy that fits with your lifestyle.

4. Align Spending with Your Values

A smart budget doesn’t mean you can’t enjoy your money — it just means you can spend in ways that reflect what matters most to you. Start by tracking your current spending. Then, create a realistic budget that covers your essentials – rent, groceries, debt payments, and leaves room for the things you care about like travel, experiences, or giving back. Use our free Home Budget Calculator to get started and adjust your financial plan as your goals evolve.

5. Tackle Debt Strategically

Many young adults carry some form of debt, especially from student loans, credit cards, or car payments. Create a repayment strategy that prioritizes high-interest debt like credit cards first, then work your way down. Always try to pay more than the minimum so you can start seeing a decrease in that debt faster. Be sure to set-up automatic payments from your paycheck to make things even easier.

6. Invest in Yourself

The best investment you can make in your 20s? You. Whether it’s continuing education, attending industry conferences, learning a new skill, or simply building a strong professional network – these investments can lead to higher earning potential down the line. Think of personal development as an essential part of your financial plan. The earlier you invest in growth, the more you’ll gain over time.

Start Your Financial Journey with Confidence

Building a strong financial foundation in your 20s sets you up for a lifetime of success. At First Financial, we’re here to help — whether you’re starting your first budget, applying for your first credit card, or planning your next big goal. Visit us at your local branch, call 732.312.1500, or explore our online resources to get started. And don’t forget to subscribe to our First Scoop Blog for more expert tips and advice.

*APR varies up to 18% when you open your account based on your credit worthiness. This APR is for purchases and will vary with the market based on the Prime Rate. Subject to credit approval. Rates quoted assume excellent borrower credit history. Your actual APR may vary based on your state of residence, approved loan amount, applicable discounts and your credit history. No Annual Fees. Other fees that apply: Balance Transfer and Cash Advance Fees of 3% or $10, whichever is greater; Late Payment Fee of $29, $10 Card Replacement Fee, and Returned Payment Fee of $29. A First Financial membership is required to obtain a Visa® Credit Card and is available to anyone who lives, works, worships, volunteers, or attends school in Monmouth or Ocean Counties. A $5 deposit in a base savings account is required for credit union membership prior to opening any other account/loan.

Everyone has a different life plan and different expenses. No matter what that looks like, make sure you’re checking off these financial milestones.

Start saving for retirement.

It’s very important to start saving early for your retirement. You benefit more from saving early, and the longer you wait, you’ll have a lot less.

Pay off student loans.

Education is getting more and more expensive and the student debt crisis is consistently in the news as a serious problem. Some students have resigned to never paying their debt off and just perpetually rolling them over. Pay them off as soon as you can.

Establish a good credit history.

While you may have missed some payments when you were younger and made some mistakes with your finances, it is important to redeem them. Developing a solid credit history will help with big purchases and shows how responsible you can be with paying your bills.

Invest in more than a retirement plan.

Whether it’s something simple like mutual funds or something more advanced like stocks, it is important to have your money diversified in something beyond a basic savings account.

Maximize employer benefits.

If you work somewhere that provides you with perks, you should be using them to the fullest. Employer match accounts are effectively the closest thing to free money that exists, so the sooner you maximize your benefits, the better.

Have a positive net worth.

This is the moment that everything you earn becomes pure profit. There is nothing more exciting than when assets – liabilities = a positive number.

Buy your first home.

Buying a home is easily one of the largest financial obligations most people will experience, and it may determine your spending habits for the future.

Deciding when to retire.

There are quite a few things to consider when it comes to retirement, and they differ for everyone. Deciding when to collect social security, how much you need in savings, and how you plan to spend are just a few of the things you may need to think about.

If you need advice or help with putting any of these financial milestones in place for your lifestyle – contact First Financial! We can help you purchase a home, create and manage a budget, assist you with improving your credit score, consolidate your debt, and our Investment and Retirement Center can help you retire and invest with peace of mind.* Contact us today to get started.

*$5 in a base savings account is your membership deposit and is required to remain in your base savings account at all times to be a member in good standing. All credit unions require a membership deposit. Membership is open to anyone who lives, works, worships, volunteers or attends school in Monmouth and Ocean County.

Article Source: Tyler Atwell for CUInsight.com