{"id":3357,"date":"2020-07-10T14:56:21","date_gmt":"2020-07-10T06:26:21","guid":{"rendered":"https:\/\/people.utm.my\/razman-ayop\/?p=3357"},"modified":"2020-07-10T14:56:21","modified_gmt":"2020-07-10T06:26:21","slug":"12-money-management-tips-for-young-adults","status":"publish","type":"post","link":"https:\/\/people.utm.my\/razman-ayop\/12-money-management-tips-for-young-adults\/","title":{"rendered":"12 money management tips for young adults"},"content":{"rendered":"
https:\/\/www.freemalaysiatoday.com\/category\/leisure\/2020\/07\/10\/12-money-management-tips-for-young-adults\/<\/a><\/figure>\n
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It is important to begin managing one\u2019s money as early in life as possible. (Rawpixel pic)<\/figcaption><\/figure>\n

The topic of money management is often ignored or given little thought. It is not taught in school nor in higher education institutions, so, for people in their twenties who are starting to build their futures, it can be a challenge.<\/p>\n

Here 12 effective money management tips for young adults.<\/p>\n

1. Money management apps<\/strong><\/p>\n

Money management apps, such as Spendee, track and calculate every sen spent.<\/p>\n

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It can also be connected to the personal bank account for a fee of RM50 per year to generate a detailed monthly personal spending report.<\/p>\n

Such reports help in budget building and knowing where one\u2019s money is going.<\/p>\n

2. Follow the 50-20-30 rule<\/strong><\/p>\n

Divide income after tax deductions into three pools \u2014 needs, lifestyle and future.<\/p>\n

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Half the income goes into the needs pool for necessities such as household expenses and loan repayments.<\/p>\n

Some 20% is for the future pool for savings or investment while the remaining 30% is the lifestyle pool for fun things like shopping, travel and gym membership.<\/p>\n

3. Enjoy the things that bring satisfaction<\/strong><\/p>\n

All work and no play makes Jane a dull girl. Do not sacrifice the things that bring joy, such as buying that new novel from a favourite author or treating oneself to a delicious meal, but spend wisely.<\/p>\n

List the things that bring satisfaction in order of importance and give up the least important. For example, if one enjoys running outside more than in the gym, perhaps it is time to give up that gym membership.<\/p>\n

4. Give some thought to the future<\/strong><\/p>\n

During one\u2019s twenties, it may seem too soon to plan for life in one\u2019s sixties but it is never too soon.<\/p>\n

It is wise to start retirement planning in one\u2019s twenties. The individual should put enough aside to grow sufficient funds for a comfortable retirement.<\/p>\n

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Save excess cash. It\u2019s surprising how quickly it grows. (Rawpixel pic)<\/figcaption><\/figure>\n

5. Save excess allowance<\/strong><\/p>\n

Make it a habit to save the remainder of one\u2019s daily cash allowance in a container (an empty bottle, for example).<\/p>\n

Even if it is just RM1, any little bit can help increase the emergency fund, especially towards the end of the month before the next salary comes in.<\/p>\n

Saving RM5 a day for a year comes to RM1,825. Invest it the following year and harvest the power of compound interest.<\/p>\n

6. Set up automatic transfers<\/strong><\/p>\n

Setting up an automatic transfer, or standing instruction, to set aside 15% to 20% one\u2019s salary gives one more control over spending.<\/p>\n

Tip: Automatic transfers can be set up for ASB savings accounts so one need not remember to do it manually every month.<\/p>\n

7. Have money conversations with the spouse<\/strong><\/p>\n

It is important for married couples to be honest with each other in money matters, be it personal or household expenses.<\/p>\n

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Be open with each other about credit scores, income and debt. If either is in financial difficulty, it is best to find a workable solution together.<\/p>\n

If professional help from a neutral third party is needed, working with a\u00a0licensed financial planner<\/a>\u00a0can help.<\/p>\n

8. Have at least RM1,000 in an emergency fund<\/strong><\/p>\n

It was reported last year that 52% of Malaysians cannot spare even RM1,000 in an emergency.<\/p>\n

Having an emergency fund is important to carry one financially through an unexpected situation. Start building a sufficient emergency fund while one is still young<\/p>\n

9. Know your credit score<\/strong><\/p>\n

A credit score is evaluated based on the number of loans and credit cards one has and how consistently they are paid off.<\/p>\n

It is an in-depth analysis of debt and repayment ability while monitoring if crucial repayments have been missed.<\/p>\n

The credit score is tracked by a secure online platform owned by Bank Negara Malaysia called the Central Credit Reference Information System. Banks use one\u2019s credit score when deciding whether to approve or reject loans<\/p>\n

10. Own just one credit card<\/strong><\/p>\n

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Keep just one credit card and use it only when there is no cash in hand. Keep the one credit card one has the longest good credit history with and cancel all the others.<\/p>\n

11. Make a shopping list<\/strong><\/p>\n

Make a shopping list before shopping, whether it is in an actual store or on online. This helps avoid overspending or spending on unnecessary items.<\/p>\n

Don\u2019t fall for cheap sales on unneeded items. Keep a list of things that need restocking soon and items one has been looking out for.<\/p>\n

12. Ask for a salary increase<\/strong><\/p>\n

According to studies, 20% of women have never asked for a salary increase. Even those who do are still paid 30% less than men performing the same duties.<\/p>\n

Be bold and speak up about a salary increase, especially those who have been working for the same employer for at least three years.<\/p>\n

Track one\u2019s job performance and use that as evidence to justify better rewards.<\/p>\n

For any successful person, money management can get lost among the many commitments and responsibilities that must be juggled. But with careful planning from an early age, one\u2019s future comfort can be assured.<\/p>\n

Working with a licensed financial planner can help simplify things and teach better financial habits to get on the right track.<\/p>\n","protected":false},"excerpt":{"rendered":"

https:\/\/www.freemalaysiatoday.com\/category\/leisure\/2020\/07\/10\/12-money-management-tips-for-young-adults\/ It is important to begin managing one\u2019s money as early in life as possible. (Rawpixel pic) The topic of money management is often ignored or given little thought. It is not taught in school nor in higher education institutions, so, for people in their twenties who are starting to build their futures, it can […]<\/p>\n","protected":false},"author":24954,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-3357","post","type-post","status-publish","format-standard","hentry","category-variety"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/people.utm.my\/razman-ayop\/wp-json\/wp\/v2\/posts\/3357","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/people.utm.my\/razman-ayop\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/people.utm.my\/razman-ayop\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/people.utm.my\/razman-ayop\/wp-json\/wp\/v2\/users\/24954"}],"replies":[{"embeddable":true,"href":"https:\/\/people.utm.my\/razman-ayop\/wp-json\/wp\/v2\/comments?post=3357"}],"version-history":[{"count":1,"href":"https:\/\/people.utm.my\/razman-ayop\/wp-json\/wp\/v2\/posts\/3357\/revisions"}],"predecessor-version":[{"id":3358,"href":"https:\/\/people.utm.my\/razman-ayop\/wp-json\/wp\/v2\/posts\/3357\/revisions\/3358"}],"wp:attachment":[{"href":"https:\/\/people.utm.my\/razman-ayop\/wp-json\/wp\/v2\/media?parent=3357"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/people.utm.my\/razman-ayop\/wp-json\/wp\/v2\/categories?post=3357"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/people.utm.my\/razman-ayop\/wp-json\/wp\/v2\/tags?post=3357"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}