Financial advice for young adults entering the work force
Laying the right foundation as you start your career is the key to future financial success, and at this life stage, time is your greatest asset. Through the magic of compounding, each dollar you save in your 20s can be worth ten times as much as one saved in your 40s. Even though many young people don't want to think about it, the beginning of your working life is the prime time to start saving towards retirement.
Here are some steps to take now to put your financial future on track:
Identify your short, medium and long-term goals and budget your money accordingly – Your short term goals of less than five years might encompass a wedding, honeymoon, furniture or a new car. Medium term goals could include the purchase of a home and financing your future children’s college education, followed by long-term retirement goals. These goals will help you determine how to spend and save your money.
Build assets through saving – A savings account can help you with your short term goals.It may be wise to invest in CDs or money market funds for your medium term goals and the stock market for your longer term goals. Citizens Bank has a variety of savings and investment options to help you meet all of your goals.
Money Market Account– Earn higher interest rates as your balance grows while maintaining full access to your funds.
Flexible Add-On CD– This special CD allows you to start with a minimum opening balance of $250, choose a term between 6 and 12 months, and then add any amount at any time.
Traditional IRA – A tax-deferred individual retirement account that generally allows tax-deductible contributions.
Roth IRA – A nondeductible individual retirement account that generally allows 100% tax free distributions during retirement years.
Establish an emergency fund – A good guide is to save three to six months’ worth of living expenses to cover rent or house payments, utilities, car payments, food, transportation and insurance into a separate bank account that could be easily accessed in the case of job loss or uncovered medical expenses. Don’t use this money for anything else.
Other bank loans – Citizens Bank has the financing to make your dream become a reality.
Understand your credit report – Your financial behavior over the past seven years, including how much credit you have, how long you've had it and whether you pay your bills on time is information included in your credit report. Three credit reporting agencies — Equifax®, TransUnion®, and Experian® — maintain these reports, and lenders buy them to help them decide whether to offer you a prequalification. Your credit report also carries your credit score ranked between 300 and 850 that many lenders use to decide whether you are creditworthy and will repay a loan. Your credit score can also influence the interest rate you pay. In many cases, the higher your score, the lower your interest rate. Your credit score is available from the three credit reporting agencies:
Be safe – Citizens Bank Insurance Services can serve all of your personal insurance needs. We will shop over 30 different insurance carriers to find a program of coverage that’s customized to your individual needs and budget. Get all your insurance needs met at the same great place you do your banking!
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Plan for you future – Your future is about planning. At Citizens Investment Services, a department of Citizens Bank, our trained experienced professionals will work with you to define your personal and investment goals, whatever your age or situation, we will work with you to select the financial tools that will help you pursue your goals.