Your 20’s are a wonderful time of your life where you’ll have lots of freedom and less responsibilities. You may have graduated from college and moved on to the next chapter of your life. Many are employed, yet don’t have to worry about mortgages, children, spouses, and more. While it’s important to have fun in your 20’s, it’s important to take care of your finances. More importantly planning for your financial future. While invest might not sound sext at this early age, believe us, you won’t regret. The younger you start investing the easier time you’ll have getting ahead. Here’s some great investing tips from top financial advisors for people in their 20s.


1) Compound Interest

It’s crucial to start investing at an early age- don’t wait! Waiting can make a huge difference, since you don’t take advantage of compounding interest. If you deposit money early, you’ll gain interest on that money year after year. Essentially, your money keeps growing every interest period. If you deposit your money later on, you’ve missed the boat.

2) Make sure it’s right for your financial plan

While investing is important, if your finances aren’t in order it will make little difference. For example, if you have lots of credit card debt and loans to pay off, investing isn’t going to help you get out of the hole. Make sure your spending is under control and you have the money available before putting it aside.

3) Money is a tool

Like it or not, the world revolves around money. In order to buy what you want, you must have the financial pocket to back it. Instead of spending your money right away, realized that you can save to buy things later on. Create short term and long term financial goals, and use investing to achieve them.

4) Increase Your Savings

When you’re young, you’re likely making less money. Try to set aside as much as you can. However, your earnings usually increase with your age. As you get older and closer to retirement it’s important to set aside more and more money. Each year you should increase the percentage of money you’re saving.

5) Don’t Compare Yourself

Comparing your financial situation to someone else’s is a recipe for trouble. You each have different financial settings with different incomes. Just because your friend spends money on one thing, doesn’t mean it’s the right thing for you to do as well. While saving may not seem like the fun thing to do with your money at such a young age, we assure you that there is nothing you’ll thank yourself for more later than investing in yourself.

6) Don’t Just Invest Money

The stock market and money can be volatile. However, investing in yourself is always a safe bet. We’re not just talking about money though, we all have areas we can improve. Perhaps you want to invest in your skill set or knowledge. For example, reading books and education is investing in yourself. These all pay off later on as well.

7) Investing automatically

Investing may seem like a daunting process. However, there are many resources to help you out with the process. In fact, many tools have automated the whole investment procedure for you. One of the easiest ways is through work sponsored programs like a 401(k) that take funds out of your payroll each month.

8) Let your employer work for you

Many jobs offer very valuable investing tools. Your job may have a 401(k) and it even might have matching contributions. This is essentially free money. For every dollar you’re putting in, your employer is putting free money for you to use later on. If your employer offers contributions to your 401(k) definitely take advantage of it!