When you’re a kid, teenagers seem so old. When you’re a teen, college students seem so old. And when you’re finally away at school, you will still probably see anyone older than you as ancient.
It’s all a matter of perspective. But this will all start to change once you hit your mid-20s. Or at least it should! By the time you hit 25, you should hopefully be able to look at your future in a new way. You need to start planning more serious about the next decade and what steps you will take to set yourself up for success in all walks of life.
This can be stressful! Nobody wants to deal with these more complex and difficult parts of life. Adulting, as they say, is hard. But now is the time to start being more strategic about everything from your career and finances to your relationships and living situation.
There’s no need to panic. You don’t have to completely reinvent yourself or change everything overnight. But you do need to learn a few things. These are the three key lessons to learn about some key money matters when you turn 25.
1. Contemplating Your Career and Work Life
A half-century ago, most people started working as young as they could and then worked in one trade for the rest of their life. That reality changed. These days, people routinely change jobs every two or three years and can even switch careers a few times before they hit 40.
So, at 25, you don’t need to have it all figured out. You should, however, have some sort of a road map and be seriously thinking about what you want to do — and how to get there. This is especially urgent if your plans include getting a graduate degree or advanced certification with great earning potential. You don’t need to enroll tomorrow or settle on one thing forever. But if you don’t get on the right route soon, it will start to become more difficult to change paths.
2. Preparing for Home Ownership
Some people already have a mortgage by 25. If that’s you, in this economy, congratulations. You’re ahead of your peers and already have a great head start on long-term financial health and general stability. For most of us, however, any home still remains a dream house. That’s OK. You have likely been focused on education, relationships, and gaining life experience. Don’t worry.
But now is the time to start thinking about your housing plans. Where will you be living in the next few years? How can you save up for a down payment? How is your credit and are you in a position to get a mortgage? Or does renting still make sense for now? These are the questions you need to be asking so that, whenever it makes sense, you can stop renting and move into a place that really is your own.
3. Protecting Your Financial Future
There are few things that seem more “for adults only” than insurance. It would have been hard to even imagine contemplating policies, coverage terms, and premium rates even a few short years ago. But insurance is not just something you have to have. It’s a powerful tool to protect your financial future. We all know that health coverage, for example, is absolutely vital and auto insurance is both mandatory and essential.
While it can be tempting to just go with the first option you find, it pays to find the best policy available. Especially for military members and vets, there are specific benefits available from providers like USAA. Don’t forget to use all the options at your disposal to get the best protection possible. Your future bank account will thank you for your foresight.
Setting Yourself Up for a Bright Future
At some point, we all have to grow up. In the past, that usually happened around 18 — or younger. Modern society affords us a bit more leeway, and there’s nothing wrong with taking a little while to adjust to adult life.
But you can’t be a kid forever, and 25 is roughly the age when it’s time to start taking things more seriously. Start envisioning the next decade of your work life so you can achieve your dreams. Contemplate how you will get yourself into a new home. And be sure to protect yourself with the right auto insurance and other coverage.
Just by taking these few actions, you will be ahead of the curve. If you take care of some major matters now, it will be that much easier to enjoy your 30s and 40s rather than playing catchup for the rest of your life.