It is never too early to start securing one’s financial future. Why wait until you think you are ‘adult’ enough to begin planning for your finances and savings. A well thought out financial plan for young adults such as yourself can be one of the best things you can do for your future, as well as inculcate a healthy way of maintaining and supporting the basic lifestyle you desire. Once you are out of school or college, the real world and all it entails can hit you really hard if you are not prepared. If you are worried your eyes may start to glaze over when you talk about financial aspects like UAE insurance or savings, remember that information and guidance on personal finances need not be extremely technical or very difficult.
Start by doing a little research and getting a head start on this awesome goal. Let us look at a few basic aspects to get you started -
Begin to exercise control – One of the first things you will learn to do as a young adult with his or her entire future ahead of them is to learn to have and take control over your money and where it goes. Start by figuring out what your expenses are and how it features according to your income. Going through details of all your expenses will give you a clear idea of what exactly you are spending on what and how much you can realistically afford to spend. Making a clear budgeting plan will also help you manage your money and figure out what needs to be done in order to achieve certain goals you have like buying a certain car or buying your dream apartment by age 30 for example. This is also a good time to evaluate your credit card expenditures and snap yourself out of a habit that has you reaching for that card without thought for regular purchases and expenses, as well as figure out how to keep recurring or regular expenses low.
Put away for an emergency fund – One of the smartest things you can do is to put aside a small portion of money periodically or in fixed intervals for unforeseen expenses. In effect pay yourself first before you pay off other expenses. Even if you are burdened with debts or loans, try and squirrel away even minuscule amounts as and when you can towards an emergency fund. Having money stashed away in case of emergencies will offer you a little peace of mind and comes extremely in handy in case you have a problem with your income source or fall in to any kind of trouble. However, make sure you put away your emergency fund cash in a way that will help you learn interest and better beat inflation, or you will lose all value on your cash. Savings accounts that offer high rates of interest and the like, are a good option.
Take steps to protect what you have – You save and collect or invest in assets you have always wanted. But then what? Make sure you actually take the necessary precautions to safeguard the wealth you have. Check what kind of insurance you need and what you qualify for like UAE insurance, car insurance or home owner and renter’s insurance etc.
Do what you can today to start building a better life for yourself. Not only does it help lead to a lifetime of better personal financial habits but also gives you a sense of control about managing your life. If you are confused as to go about it or rather not do it alone, talk to a trusted personal finance advisor who can guide you on the right path.
Matt Laury is a financial adviser in Dubai and a contributor to financial websites and journals. He advises clients on everything from UAE insurance for their homes to finding the right kinds of securities for their needs.