Every young adult has to adjust to a new sense of financial responsibility. As I have written before, it often means coming to grips with managing your own finances without the help of mom and dad. This often means that they are learning lots and lots of new things everyday. This includes issues such as insurance, renting, employment, among many other things. Despite the new world that many young adults find themselves in, there are certain issues that young adults should not have to worry about – but too often do.
Paying Off Debt: Paying off your debt is something that limits young adults from saving in their early years of their career. Many people consider debt consolidation, while others put it off as long as possible, making the minimum payment. Simple put, avoid going into debt at all costs!
Car Payment: Using your new salary to finance a new car and pay monthly payments can be a very dangerous idea. While it may feel nice to feel reassured that you won’t break down on the side of the road, this limits your financial freedom significantly.
Foreclosure: To add insult to injury, too many young adults are losing their homes because they bought before they were financially secure. Making sure to save enough money before you make the leap to home ownership is very important. While it may be nice to have your own home at a young age, it’s not worth the risk if you don’t have an emergency fund.
Taking the time to avoid messy situations when you are a young adult is very important. It’s always better to prepare for things – to be pro-active instead of reactive. Trying to dig yourself out of a hole will be a lot more difficult than avoiding it in the first place.
Have you found yourself in a difficult situation as a young adult?