It might not feel like it yet, but your 20s will zip by faster than you realize. You’re at your first “real” job, earning your own income, and, perhaps, even living on your own. Your salary may be humble, but you also have the flexibility and energy to take your life wherever you need it to go.
This is exactly why your 20s are so important when it comes to your financial future. Every decision you make at this point, from opening a savings account to continuing your education, will shape your financial stability and quality of life for years to come.
The sooner you take charge of your financial future, the sooner you can start living life the way you want. If that sounds good, here are some smart, strategic moves you should be doing.
1. Build Credit as Early as You Can
While the rate of credit card application in the Philippines is on the way up, many young adults still avoid credit cards due to a deep-seated cultural aversion to “frivolous” debt. While taking on debt is ultimately your choice, you should know that responsible credit card use can actually strengthen your creditworthiness, significantly improving your financial position. Good credit takes time to build, but it is worthwhile, especially when it’s time for big steps like raising a family or buying a home.
If you’re new to the workforce, the Landers Cashback Everywhere Credit Card is the best credit card you can get. After all, if you’re already spending on groceries, dining out, or online shopping, why not earn some cashback in return?
The Landers Cashback Everywhere Credit Card by Maya offers up to 5% cashback at Landers, 2% on dining spends, and 1% on other qualified purchases,* giving you more ways to save and more reasons to use your card. Not only do you get cashback savings on already-amazing Landers deals, but you also get to build a consistent credit history early on.
Even better, unlike other cashback cards, no complicated voucher systems or conversions are needed to enjoy your cashback. The next time you shop at Landers, just tell the cashier you’d like to redeem your cashback and follow your Maya app prompts to complete the process. For a first-time credit card application in the Philippines, this joint Maya-Landers offering is not one to be missed.
2. Start a Savings Habit
You don’t need to stash away thousands of pesos each month to build wealth. Even PHP 1,000 deposited consistently every payday can make a big difference in just a year. Start treating your savings as a recurring bill, and you’ll be surprised how quickly it adds up. And if you start in your 20s, you have a good shot at growing this cash into real wealth through compound interest.
3. Build Good Money Habits ASAP
Budgeting is a skill, much like cooking or driving. It’s only when you actively practice it that you can expect to become good at it. Making this a priority in your 20s can give you a huge edge, given that you have decades of earning (and learning) ahead of you.
Contrary to popular belief, being good with money doesn’t mean you have to cut out everything fun. You just need to weigh your priorities and make sure your spending reflects them. Tools like the Maya App can give you real-time insights into your spending over your credit card, savings, and digital wallet, making it easier to stay in control of your finances.
4. Invest in Skills That Pay Off
Speaking of useful skills, upskilling in your 20s can be advantageous, as you’ll have significantly more energy to balance your current job and your ongoing education. Of course, with a wider palette of skills, you have a much better shot at earning a higher income over your lifetime.
5. Start Building an Emergency Fund
For most people, their 20s aren’t yet their prime earning years. Still, you’ll want to make room in your budget so that you can save at least 3 to 6 months’ worth of essential expenses in an emergency fund that’s separate from your regular savings. Ideally, this cash should be in a high-performance savings account for easy access and to preserve its value against inflation.
Having this extra cash can be a lifesaver for a number of reasons. Aside from giving you invaluable peace of mind, it keeps you from being completely dependent on your current job. Given that your 20s are the best time for career changes, you’ll be glad to have the cash to weather these kinds of transitions.
6. Don’t Use Too Much of Your Credit Limit
Your credit limit is just that: a limit, not a suggestion. Unless your lifestyle has significantly changed, increases in your credit limit should not be an invitation to spend more.
A good rule of thumb when using any credit line is to mentally restrict yourself to using no more than 30% of your limit. This keeps you from overextending yourself, and it also keeps your credit score healthy, giving you access to better deals in the future.
7. Aim to Pay Your Card in Full
Paying just the bare minimum is common advice, but it’s seldom the right decision. While it can be easy to justify doing so during lean months, doing this regularly will almost certainly put you in a dreaded debt trap; not exactly a position you want to be in at an early age. In the vast majority of cases, the smarter move would be to pay it off in full. If you can’t, aim to pay as much over the minimum as you can to avoid prolonging your debt.
It’s Time to Make Your 20s Count
The best time to build a strong financial foundation is before life gets too complicated. Good money habits, common sense, and good financial tools like the Landers Cashback Everywhere Credit Cards can help you take full charge of your finances early in your career, giving you a springboard to real, lasting freedom down the road. Apply for your own credit card via the Maya app to begin your first steps towards better things.
*Transactions that don’t qualify include: cash in, cash advance, quasi cash purchases, casinos and gambling, fuel, supermarket, pharmaceuticals, utilities, telco, and government.
