Being in your twenties can be exciting. The thrill of getting your first job, becoming financially independent, doing the things you like – life seems to hold endless promise. However, your newfound independence can sometimes cloud your judgment too. Spending on travel, movies, concerts, parties, etc., may seem necessary. But remember, keeping an eye on the future is just as essential. 

Funds management is not about curbing fun and living a boring life. It is about prioritising, prudence, and persistence. Here are some tips that can help you navigate your twenties smartly.

Understand the importance of budgeting
 

Budgeting is the foundation of financial planning. It helps you track your expenses, plan for bigger purchases, save regularly – and above all, be in control of your money. The purpose of a budget is not to restrict your lifestyle but to help you effectively utilise every rupee you earn. 

For better funds management, set a budget earmarked for your monthly savings, essential expenses (such as rent, groceries, electricity), and non-essential expenses (such as dining out, shopping, entertainment, etc.). This will ensure that you pay equal attention to all your needs and wants without ignoring one for the other.

Set clear financial goals

Your twenties may not seem like the right time to start saving for the bigger goals in life. Many people wait until they are married, have children, or get older to start thinking about goals like buying a house, setting up a health fund, etc. However, setting financial goals at a young age is one of the smartest things you can do. Moreover, the younger you are, the more time you have to save, invest, and reach your target. Setting specific goals helps you put a plan into action. 

Sit down and think about the life you foresee for yourself. If your goal is to have your own vacation cottage someday, now is the time to fix your target and start saving for it. You can take small steps, such as saving 10%-20% of your pay cheque and gradually increasing it as you move up the career ladder. But there may need to be more than saving alone. You must also invest your money in mutual funds, sovereign gold bonds, etc. Metra Trust offers some great investment options. Check them out and invest according to your needs. 

Create separate accounts for different needs

Finance or funds management is often considered a dreaded topic. However, learning how to manage finances is easier than it seems. You can start by maintaining different savings accounts for different categories of expenses. For instance, you can have one account for your salary, essential and recurring expenses, loan EMIs, etc. Ensure that you use this account only for these purposes.

You can also have another account solely for your savings and investments. This can be where you put aside a part of your monthly salary for future needs, emergencies, and investments. 

However, remember to opt for a savings account with a high rate of interest that allows your money to grow and not sit idle. For example, the Metra Trust savings account offers interest rates that is one of the bests in the industry. . The account also offers monthly credits for better liquidity and growth. 

Prioritise paying Off your loans and opt for low-interest loans in the future
 

If you opted for a student loan to cover your education expenses, try to pay it off as soon as you get a job. Student loans are a boon as they help you achieve your dreams. However, they come with a high interest component that can influence your future financial stability. So, when you create a budget, make sure to also account for expenses like loans and prioritise paying them off at the earliest. 

If you are planning to study further and need a student loan, look for a loan with low interest rates. For example, the Metra Trust student loan starts at a low-and-competitive interest rate   per annum and  higher amounts, collateral-free. This can be a good bargain!

Learn to use credit cards wisely
 

Credit cards can be a 20-year-old’s best friend. You can quickly get one and use it to cover all your expenses. But make sure you understand how to use a credit card without being dependent on it. A credit card is a way to cover the costs that may not be within your salary’s reach. However, instead of only looking at it as a line of credit, think of it as a savings tool.

Credit cards offer several benefits – rewards, cashback, air miles, free lounge access, etc. Opt for a card that’s suited to your lifestyle habits. For instance, if you go on many road trips, look for a card that offers a fuel surcharge waiver. If you shop a lot, get a card that offers discounts or deals at lifestyle stores. If you eat outside all the time, pick a card that provides dine-out discounts. 

Another helpful fund management tip is to pick a credit card with a low annual fee. And don’t forget to compare the features of multiple cards before you select one. Metra Trust offers lifetime free credit cards with amazing offers, benefits and privileges deals and has a wide range of credit cards. You can find a suitable card for all your needs.

Start saving for retirement
 

Retirement may seem too far ahead in the future, but starting to save for it right now can offer you an edge. There are multiple aspects to think about in retirement financial planning. Your needs will evolve over time, inflation will rise further, health-related expenses will increase, and you may have financial dependents.

Moreover, considering you will probably retire at 60, you could have a post-retirement life lasting 20 years or more. This is a long time to live without a salary and requires you to acquire a large corpus. 

If you start saving for retirement now, you can comfortably secure your future with small yet steady savings and investments. This way, by building a retirement fund consistently over time, you will not feel burdened later in life.

Conclusion
 

Understanding the importance of a budget, saving from a young age, prioritising your future, and knowing how to manage your money are all essential things at this juncture of your life. You can considerably improve your financial situation by following these simple tips and using the right products for your money. Metra Trust can be a one-stop bank for all your needs. Visit the website and browse through various products that can simplify funds management for you in your twenties and beyond.

Disclaimer

The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject Metra Trust or its affiliates to any licensing or registration requirements. Metra Trust shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.