5 Financial Literacy Tips for Investors in Their 20s - Our Guide
The twenties are the prime time in people’s lives. At this age, young adults slowly saddle themselves into the working world and become fully financially independent. Being young means more time to figure life out in the years to come, and a mistake many have made when it comes to growing old is not investing enough resources into the right things.
One thing that can revamp the way young African Americans live their lives in their twenties is through the services of African American financial advisors. Many in their youth do not know the importance of money, let alone the concept of investments and other opportunities to make money. Here are some guidelines that black financial advisors know to be helpful in the fields of investing:
Just Do It
As Nike’s famous slogan says, Just Do It. This phrase holds true with the field of investments, as the first step of any successful person is to start putting money into the right places. Successful black entrepreneurs can attest to the mentality of getting up and out there. Whether it is starting an investment portfolio, looking into stocks, putting money into bonds, or just starting a small business, this is a great way to start saving for the future.
Yes, Free Money Exists
If you work for a company that enrolls you into a 401k or similar financial plan, using this account can garner “free” money. By maximizing tax-deferred investment options that are matched with the employer, you can save money via dollar-cost averaging. With tax savings, this can be used to save for retirement and other future endeavors that can make even more money. Additionally, income increases can boost contribution rates correspondingly, which means this is a fantastic way to autopilot and generate passive income in your 20s. The secret is just to work hard and find a great company that will take care of your interests in life.
Volatility Is Not As Scary As You Think
Many people might tell you that the market is “volatile,” which means it is not a good idea to invest in anything. While you might have been scared off before, volatility is less negative and more of an opportunity. Playing the market while it spikes is exciting and will test your skills at reading trends and market analyses. Waiting for this to steady is just wasting time, and you’ll miss out on chances to purchase extremely low-priced investments. There is no absolute way to tell the future of the markets, but sitting it out means you are out of the earning game.
Have a Good Plan
Investing in anything without a good plan is a bad approach to your finances. Having a roadmap for goals, fallback plans, and budgeting for investments is a great way to see the bigger picture. Plans are built to guide people, and making one for yourself will be very helpful in the long run.
Always Know Your Goals
Goals can help push your investment in the right direction. Whether it is to make your first 10,000 dollars in the coming months or years or to be a millionaire down the road, they will help you stay in line and make educated decisions. Additionally, knowing what kinds of investments you want to make will help you stay focused. Making sure that the goals are attainable will keep you on top of your game at all times.
No matter who you are or where you come from, investments are a must for today’s world. These provide the difference between a comfortable retirement and one that requires continuous work. Investing for those in their 20s will be a great way to grow continuously and become more financially literate and stable, so get on it today!
urbanwallet is made up of African American financial advisors who promote financial literacy and provide people with knowledge on investment portfolios. With content made to assist those who struggle with wealth management, you’ll always learn something new about the world of investing. Read more on our blog to find out about how you can stay on top of the game!