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Once you’re on your own, responsible for yourself, there’s no rule that says you have to figure everything about money out for yourself. Maybe you didn’t get into any good habits when you were growing up; maybe your parents didn’t guide you to making the best money choices.
Today, you start moving on the better path. Being an adult with your money boils down to five important steps you must take.
1. Open an investing account.
Think you need a lot of money to invest? You don’t. Without investing, it’s going to be really difficult to make the dreams you have for your life come true. If you want to work every day into old age and worry about how you’re paying the bills, you can get by without investing. But if you want something better for yourself, you need to get started today.
Start with an account at Betterment. Open an account today with as little as $30. You can save up first if you need to, but make this a goal for the end of the month. Betterment will guide you through your choices and help you pick the best investment for you. There’s no need to learn everything about stocks and bonds first. There will be time for that later — but by investing as soon as possible, you don’t miss out on the best aspects of the stock market: the gains.
2. Open a high-yield savings account.
Here’s what goes in your savings account: any money you don’t invest and don’t need to use to pay bills for the next month. Don’t just walk into your bank and open an account. Look at this list of the best savings accounts. The highest interest is important because a bank is just a place to store your money. You might as well make it work the hardest it can for YOU.
The interest you earn in a savings account will compound, so this is a key to being able to smooth out the rough patches of life that you’re guaranteed to have.
3. Have the conversation.
Talking about money with a partner is stressful! Make it easier with this free cheat sheet. This index card will help you talk about money without feeling nervous or anxious. Maybe you’re afraid to admit something, or maybe you’re concerned about what your partner will think. You can get through this, and your relationship will be stronger for it. Download the free cheat sheet by entering your email address below.
4. Increase your income.
Nothing is more satisfying when you create something and are paid for it. But there are many ways to get paid. And even if you have a day job, you should be exploring all the different ways to make some money on the side. At the same time, you need to focus on getting raises and promotions early in your career, because that has a huge effect on your lifetime earnings.
Even while increasing your job income, consider taking steps to make more money elsewhere. The latest hot tip is becoming an Uber driver. If you like spending time in your car, get paid to drive people around. It beats selling your body parts.
5. Get in those good habits.
While you want to focus on your money and the progress you’re making, the more you can automate some of the more helpful tasks, the better off you’ll be. Use direct deposit so you don’t have to worry about depositing your pay check. Here are some ideas:
- Set up an automatic transfer from your checking account to your investment account.
- Use your bank to set up automatic online bill payment.
- Configure your credit card to pay your bill in full every month.
Creating these habits gives you less to worry about, reduces your stress, and increases the money in your wallet when you need it.