US Households struggle to save money. This is a fact. With the average personal savings rate at around 6%, it’s clear that households across the United States struggle to save money and ultimately build wealth.

While families across the country struggle to increase their wealth, young adults face even more challenges than the rest of Americans.

I graduated college in 2009, into one of the worst job markets in recent history. Thankfully my wife and I graduated college without any debt and had a little bit of savings to help us get started as young adults. This afforded us some time to find a job and cover our bills. But this would not last long if we did not quickly find jobs to cover our expenses.

The situation would have become much worse if our cash flow did not improve soon. We were able to find jobs and begin to cover our daily expenses, but it was not easy.

Shortly after we moved in our first apartment (where we spent as little as $600 furnishing the apartment), we both secured jobs. But they were far from our dream jobs.

Heck, back then I’m not sure if I knew what my “dream job” was. (Is there such a thing? Who knows…) Mrs. 20s ended up working as a street canvasser and I worked full-time at a local university.

Mrs. 20s’ compensation included incentives when she performed well, similar to being paid on commission. She ended up being a successful salesperson, which made her the bread winner of the family. This is helpful because we struggled to make ends meet, even with her performance pay.

For the first few years of our marriage, we had a lean budget. It wasn’t until maybe 4-5 years in that we created what we called a fun budget, where we allowed ourselves $500 a month to splurge. Until that point, we prioritized a debt-free lifestyle.

While we were able to make ends meet as young adults, it was very challenging to save money. It seemed like the odds were stacked against us. We didn’t let this get us down and we pushed on, but that is not to ignore the challenges with saving money that we faced as young adults.

Young individuals or families face even more challenges. While young adults may have fewer expenses that older individuals do, that doesn’t mean that saving money is easy.

Below are some of the challenges that young adults face when trying to save money.

saving money in car savings bank

Why It’s Hard For Young Adults to Save Money

1. Low Salary: Young Adults Earn Less

Students graduating from college are entering the job market with little to no work experience. As we did when we graduated college, young adults are often forced to settle for any regular job.

Many of my college friends have been forced to continue working at a restaurant or accept an Americorps position because of the inability to find something better.

Having a low salary makes it difficult to save money no matter who frugal you are.

2. High Student Loan Balances

While I was able to graduate from college without student loans, most young adults are buried in college debt.

The average college graduate finished their education with almost $30,000 in student loans.

Most of these loans come due six months after graduation. Even with making the minimum payments, the commitment to repay these loans takes away from what little income people in their twenties do have.

This moves saving money to the back burner.

3. “Need” for Technology

If the first two challenges weren’t enough, most young people have lives that are connected to technology. Interacting on social networks is part of young adults’ culture.

Facebook was created with my generation. The ability to stay connected comes with an associated cost.

Based on an informal poll of my friends, young adults often pay large amounts for the latest gadget. Whether it’s the latest phone, computer, tablet (although they seem to be losing steam), young adults appreciate and pay for their technology (apparently anywhere from $1,000 – $2,000 for a new phone).

In addition to buying new hardware, there are also the ongoing costs, both for high-speed internet and unlimited data plans.

The price of technology gives a new meaning to the latte factor.

Young adults’ commitment to technology and prioritizing this expense means fewer resources to dedicate to savings.

4. Lack of Experience

Starting to manage your own finances can be a challenging task. Learning to reduce your expenses and increase income doesn’t come easily.

It often takes time to adjust. It can even take a few big mistakes to shake people in their twenties into reality.

Many young adults don’t realize the work it takes to stay out of the red each month. It could be that they are used to living on their parents’ income or just a matter of inexperience.

How to Save More Money

Just because the odds may seem like they are stacked against you, it does not mean that you are powerless. Over the past 10 years, my wife and I have learned to save more and more money. We now save about half of our income and you can do the same.

1. Set Financial Goals

I find it extremely motivating to set a financial goal. Similar to how registering for a 5k race can get you off the couch and training, setting a financial goal can also motivate you enough to act.

2. Increase Your Income

The biggest contributing factor to us increasing our savings rate has been advancing in our careers and the accompanying pay increases that come along with that.

Once you start to earn extra income, saving money becomes that much easier. It is not automatic, and you have to prioritize savings, but earning more money makes it easier.

The easiest way to earn more money is to either find a new job because studies show that you can get a huge increase by switching employers, or better yet, earn a promotion at your current employer.

3. Curb Your Spending Habits

This may seem obvious, but the third (and perhaps the most important) step you can take to save more money is to stop spending money.

This is not always an easy task. Often spending money is an emotional decision, not always a rational one.

While on the surface it may seem like you just need to spend less, it may also mean that you have to do some reflection and behavioral changes.

Break the Mold and Save More

It may not be common or easy to save money at a young age, but it is possible. Be creative, commit to incremental change, and be relentless.