Money anxiety is a rite of passage for everybody who is in their twenties and thirties, so do not feel lonely about it. As if you have to own your house and put some money to a 401(k) fund, while still figuring out how to file your taxes. Believe me, this pressure of being “an adult” is exhausting, but you will survive it without a mental breakdown. So let’s break the chain of panic and get back control over your mind. 🧠
The first thing you should stop doing is ignoring the problem. Avoiding your bank account will not help you with decreasing your bills, only increase your stress and turn it into the problem. Open your bank account right now and check the amount there. Of course, this amount will be not pleasing for you, but it is the only way you will manage with the situation. You cannot find your way out from the labyrinth if you do not accept that you are lost. 🗺️
After checking the balance, you have to make a budget. A budget is nothing else than the plan of your spending. I found that the most convenient way of budgeting is the 50/30/20 rule, as it is so easy to follow. Fifty percent of your salary goes to necessities, thirty percent to non-essential things you buy and twenty percent goes either to savings or paying your debt. If your salary goes on rent, then it is an entirely different story. 💸
Now we come to the most unpleasant point. You have to make an emergency fund, even if you are saving only twenty dollars per week. This is absolutely necessary, as life loves surprising us with the unexpected expenses, such as repairing your car or emergency medical treatment, and having the emergency fund saves you from becoming a victim of those things. It takes time to build, but it feels wonderful. It is a way to reward yourself in the future not to panic. 🛡️
Investing is scary, but keeping all your money on your bank account loses their value because of inflation. Of course, you do not have to trade stocks and monitor cryptocurrency rates, just open Roth IRA account or install Acorns app and invest in index funds. It is safer to make boring things when you are investing as the compound interest will do the job. 📈
And finally, be kind to yourself, as financial literacy is a skill you have to learn and not a natural gift. You will make mistakes and will spend too much money, for example, buying an expensive latte or subscribing to something you will never watch. Do not beat yourself up about this, just change your budget a little bit and keep moving forward. You are doing everything right. 😊