Money and Credit: What You Should Know by 30

Learning financial responsibility in your twenties can be a total game changer for your future. By learning the following six lessons about money and credit before you turn 30, you can set yourself up for more financial freedom and peace later in life.

1. Get a side hustle now. Seriously, while you still have the energy and time, get a side hustle. Not only will you save some money by not spending every evening at happy hour, but you will also be earning some extra cash during that time.


building credit

Read: How Boarding Dogs and Cats Can Earn You Easy Cash


2. Every dollar has a place. In other words, get a budget! Create a budget and assign every dollar to a category. If you have money left over you will spend it on dumb stuff, instead allocate it towards financial goals so you aren't tempted to waste in on yet another one of Kylie's lip packs.


how to create a budget

Read: A Day in the Life of an Overspender


3. Set financial goals. Whether your goal is to pay off debt by a certain deadline, save for retirement, or buy a home, start thinking about your financial future.


credit score

Watch: Set Financial Goals Before You Save


4. Make saving money for retirement a necessity. To the previous point, if you are debt free, then saving money for retirement via an IRA or 401k should be a fixed cost in your budget. The younger you start saving the more of the compounding interest you can rack in. Plus did you know it's nearly impossible for someone who started saving for retirement at age 30 to catch up to someone who started saving for retirement at age 20?


5. Building credit takes time, destroying credit takes minutes.  Seriously, every time you open a store card for that 20% off you're hurting your credit. Then factor in that most Americans are living in financial chaos (for example: forgetting to pay the bill on time for that store card), and your score is hurting even more.

A good rule of thumb if:

– you're new to credit (as in just started building your credit within the last six years), or

– you don't have an emergency fund with six to nine months of income in it, or

– you have had a checkered past with credit

is to only charge what you can pay off in 24 hours.


credit mistakes

Read: 5 Credit Mistakes Most of Us Make


6. Live below your means. In your twenties you will probably make some nice jumps in your career, which come with nice salary boosts. You should use that as an opportunity to live below your means, rather than fall into the trap of lifestyle inflation to match your new paycheck. Remember, just because your co-worker comes in with new designer shoes every week, does not mean they don't have a buttload of debt they are paying off. Dave Ramsey says you have to “live like no one else today, so you can live like no one else tomorrow”… meaning that most Americans are in debt, and if we live below our means when we are young, we don't have to be tied to debt in our future.


credit score

Read: How One Couple Managed to Save 70% of Their Income

Read the original article on The Confused Millennial. Copyright 2016. The Confused Millennial is a Lifestyle blog for the multi-passionate millennial feeling totally confused by this whole “adult” thing. Follow The Confused Millennial on TwitterPinterest, and Instagram.

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After getting fired twice in under a month, Rachel Ritlop decided to embrace the old adage, “those who can’t do, teach”, and quickly excelled as a career and business coach earning thousands each month. Rachel has been seen in Forbes, Fast Company, Brit + Co, and Dailyworth. Rachel is also the founder of The Confused Millennial, a lifestyle blog.

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