Why Saving in Your 20s Is One of the Most Important Investing Decisions You Will Make
Saving is often outside the frame of mind of people in their twenties. But, as Entrepreneur Network partner Phil Town recommends, the earlier you start, the better. By beginning to save a few years earlier, you will see a lot more money when you are ready to retire.
Some tips to apply when you are just starting to save? First off, pay off that student debt. Student debt is often one of the foremost money concerns for people in their twenties. Town notes that the same way that money you invest will increase exponentially -- the same goes for student debt. So, work to tackle this part of your financial responsibility first.
Town also recommends paying yourself over other expenses. Though this may be a familiar adage, it can be helpful to pay yourself before all the other bills and outlets for expendable income build up. In this way, you will also see the benefit of setting specific saving goals. Pay attention to establishing specific amounts you plan to save and continue to put some money aside. Town lays out an example of how deciding to buy a refrigerator for $1,000 can alternatively make a huge difference when it's put into an investment account. By compounding this money over 20 years, that refrigerator money will grow to $1 billion.
Click play to hear more investment tips for 20-year-olds.
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