1. Increase retirement investments. As young professionals who will eventually retire or cut back on work at some point, we need to start investing in our future. While many of us may already have started setting aside money for retirement, others of us may not have begun that process. In 2020, let’s strive to do even more. Let’s commit to increasing our retirement savings, even if it’s by a small amount. As we continue to set aside more money for retirement, we will have a greater amount of money invested, which will allow the magic of compound interest to work in our favor and increase our net worth.
2. Save more of your income. In addition to investing more money for retirement, I am also striving to save more in general in 2020. In addition to saving up money for vacations and large purchases, we should also have a certain percentage of our income in an emergency fund and for unexpected expenses. While some people may choose to save all additional funds in retirement accounts, I plan to keep a certain percentage of money “liquid” or saved outside of retirement accounts just in case I need to access it at a later date. It’s difficult to take money out of retirement accounts before you reach your mid-50s, so having money saved in a more accessible account is ideal for those of us who may be a bit younger.
3. Live below my means. As I enter 2020, my goal is to live below my means. Instead of buying things because I can afford them or living the doctor lifestyle I envy, I’ve chosen an alternative path: practicing self-control. I share an apartment with a roommate, which allows me to save money on housing costs and other bills. I have a budget for food that I adhere to each month. I also refrain from going to the mall unnecessarily or buying things I want simply because they’re “on sale.” Learning to live below my means has helped me become less materialistic and allowed me to save more, invest a greater amount, and be better prepared for any unexpected events. It has also prevented me from buying things to impress those around me. Instead, I’m focused on my own financial goals, which will allow me to make even greater progress toward financial independence.
4. Pay off bad debt. Before I became financially literate, I made some costly mistakes. I used credit cards to purchase things I didn’t need. I moved to a city I couldn’t afford and failed to live on a budget. I also didn’t save much of anything, for retirement or for emergencies. Now that I’m older and wiser, I have sought to right these wrongs. You might be doing the same thing as well. As we enter this new decade, let’s strive to get rid of credit card debt and car loans and refrain from accumulating more. The quicker we get rid of high-interest debt, the sooner we can increase our cash flow each month and have more money to invest.
5. Give money to charity. Along with spending money on ourselves and saving money for the future, my goal is to give more. It can be easy to focus on my own priorities, but giving allows us to improve the lives of others. Whether it’s paying tithes to the church or increasing charitable donations, giving is a selfless act that allows us to make a difference in the lives of people with real struggles and financial hardships. Although I’d love more money for myself, I recognize that I’ve been blessed beyond measure and should actively seek to pass that grace onto others.
Altelisha Taylor is a family medicine resident and can be reached at Career Money Moves.
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