You’re probably wondering if you’re on the right path to financial success, if you’re doing “enough,” or if what you’re doing is even right.
When you’re in your 20’s it’s hard to know if you’re on track for financial success for your age.
Since we all have different jobs, different sources of income, different upbringings, and different situations all together, it’s pretty tough to compare yourself to someone else.
That being said, there are a few key markers to gauge if you’re on the right path or not with your finances!
Here are 5 financial milestones to hit in your 20’s and use as a measure of progress to ensure that you’re riding smoothly into your 30’s and beyond!
1. Start Saving for Retirement
Getting a jump start on retirement saving needs to be high priority. The reason for this is compound interest; the earlier you start and the longer you’re saving for, the faster your money will grow.
If you contribute just $300 a month starting at age 20, you’ll retire with over $1 million. If you start at age 30? You’ll have less than HALF OF THAT!
2. Reach a Positive Net Worth
Your 20’s are your chance to get ahead, and that means hammering away at your debt (hellooo student loans) and focusing on building a foundation.
Breaking into a positive net worth before you enter your 30’s (not including a mortgage) gives you a clean slate to build long-term wealth.
3. Pay off All Consumer Debt
Credit card debt is a major enemy. Get rid of it as fast as possible, or it will cripple you financially.
4. Reach a 750+ Credit Score
Paying off your credit card will help boost your credit score! Reaching “Excellent” status on your credit score will help you secure lower interest rates and be able to afford life’s bigger purchases, like a home.
5. You’ve Started Building an Investment Portfolio
Investing in the stock market is the best way to keep your money working for you. Once you’ve reached a solid cadence contributing to your retirement, start branching out into a brokerage account and really help your money grow.
Hitting these financial milestones in your 20’s will really help you get ahead and feel secure in your 30’s and beyond! The earlier you hit the milestones, the more you’ll reap the benefits. If you’ve been struggling to identify what to focus on beyond a simple budget, focus on these milestones to start building long-term wealth.