How to Become Financially Stable in Your 20s


When you sit back and think about what things will be like when you’re financially stable, you probably look at it like it’s some far away, long off goal.

Financial stability isn’t for 20-somethings, right? It’s for people who have worked their whole life and have high paying jobs.

Well, not so much.

It’s possible to become financially stable in your 20s with a little work and smart spending. And the sooner you get on your feet with money, the sooner you can start saving for big-ticket purchases and your retirement.

If you’re a young person who isn’t sure how to become financially stable, keep reading. We’ll lay it out for you step by step so you can start living the financial life you deserve.

Get Good at Earning

How are you supposed to get financially stable if you don’t have a source of income? By now, it’s common knowledge that “millennials” aren’t the lazy do-nothings that they’re depicted as on the news. But does that mean you’re meeting your maximum earning potential?

Probably not.

Take a look at what your marketable skills are and try to use them to make money. This doesn’t have to be a fancy degree, either. “Marketable skills” doesn’t have to mean something like being an architect.

Are you available most hours of the night? Night shift employees tend to make more per hour thanks to shift differentials.

Do you like to sew, knit, or crochet? Maybe you could set up a side hustle on top of your day job to earn a little extra cash.

There’s also tons of freelance work you could do on the side if you know where to look.

The point is that you need to maximize your money-making efforts now so you can start making the right choices with your money in the future.

Find Out Where Your Money Goes

Next, you need to sit down and make an honest list of all the things you spend your money on. Keep track every day of the things you buy.

If you find yourself swiping your card at fast food joints, start packing your luck. Skip the Starbucks and make your daily brew at home.

This doesn’t mean that you can’t splurge on nice things, either! If you’ve got a coffee habit that you can’t break, try to look at other places that you could be saving to make up for it.

Make a Responsible Budget and Stick to It

Sit down with a pen and paper and list out all of your monthly bills. Write down everything you spend your money on from your utilities to your gas station stops to your small ticket items.

It won’t do you any favors to skip out on things like “restaurant allowance” or “entertainment.” Sure, your budget will be a little smaller, but you’ll wind up taking money allotted to other things in order to satisfy your desire for takeout once a month.

Instead, include that in your budget and find a way to make it work.

It’s a good idea to keep a calendar and write out all of your due dates for your bills. That way, you’ll know how much money from each paycheck needs to go to the important things.

Repay Your Debts

Next, you need to take a look at your credit score. Get your credit report from one of the three credit bureaus (you should get a free once a year from each) and take a look at what’s on them.

Pay close attention to this part. You’ll want to make sure that everything on them is accurate and dispute the things that aren’t.

Take a look at all of the places you owe money to and make a plan to pay these debts off.

Be Prepared

Now that you know where your money is going and have a plan to pay back your debts, you need to decide what to do with the money left over at the end of each month.

Even if it’s a small amount, you should start to set aside money every month for emergencies and retirement.

What happens when your car breaks down on the side of the road and you need a repair? The first place you probably go is mom and dad. But the core of financial independence is being able to pay these expenses yourself.

You also need to be prepared for retirement. It might seem a long ways away, but unless you start saving now you might find yourself coming up short when the time comes.

Create a Positive Credit History

Next, you want to increase your credit score. Even if you’ve never taken out a loan or a line of credit, you need to be concerned about creating a credit history.

No credit looks just as bad as bad credit.

You should look into opening up a credit card or taking out a personal loan. If you have bad credit, there’s still hope. Take the time to learn more about personal loans for bad credit, too.

Stop Asking Your Parents for Money

We’ve come this far, now it’s time to cut the cord.

Stop asking your parents for money.

Hopefully, you’ve got the kind of parents who have no problem lending you a hand when you need it. And that’s fine! There’s nothing wrong with reaching out for help when you’re drowning financially.

But if you want to be truly financially stable, you have to be able to do it on your own two feet.

Keep Control of your Financial Documents

Lastly, you need to find a place to store your important financial documents. Bank statements, bill reminders, and receipts for large ticket items that have been paid off are just a few of the documents you should hold onto for a length of time.

If you’re self-employed, keep the receipts for things that you can use as a tax deduction as well!

How to Become Financially Stable in your Twenties

Many people don’t know how to become financially stable. When you’re in a rut with money, it seems like there’s no way to get out of it. You need money to pay for your car to go to work but you need to work to get money, where does the cycle end?

But if you’re smart about your marketable skills and you start being mindful of where you’re putting your money, you’ll find out that financial stability isn’t all that far away.

If you want to read more about finding a more fulfilling life, check out this article next!