13 smart money moves to make in your 20s | Getting on the fast track toward financial success

Finally having a steady income can be exciting — sometimes a little too exciting.

It’s easy to get into financial trouble in your 20s without even realizing the potential consequences. Simply paying attention to your spending and saving habits early can make reaching financial success a whole lot easier in the long run.

So when you’re just starting to get your financial life together, or starting to think about it, here’s a list of tips to help you better understand your money and how to get better spending and saving habits in place now.

Making a habit of living on less than you make will help you reach your financial goals much quicker and easier. If you get used to this early, it will get you in the habit of saving more and spending less, allowing you to save for big purchases— such as a house or car  and put more money toward your retirement.

Spending less than you make will also help you avoid credit card debt. Using credit cards to build your credit can help prepare you for when it’s time to make one of those big purchases, but you have to make sure you’re doing it the right way. Here is a guide to understanding your credit score.

Spending less than you make requires you to pick and choose. Maybe you don’t go to every destination wedding, every group dinner or every girls’ night out. Or maybe you go to dinner, but eat before you go so you aren’t stuck with a big bill when everyone splits the check.You can have a social life without draining your wallet. Decide what’s most important to you and start saving for those things. In the long run, you’ll be glad you aren’t buried in credit card debt for tapas and hangovers you never wanted anyway.

It’s really easy to lose track of how much you’re spending when you don’t pay attention. We’ve all had that moment near the end of the month when you go to check your bank account and you’re too afraid to look… But the good news is, if budgeting isn’t your forté, there are tons of free apps and websites that will manage your finances for you and keep you on track each month. They’ll also break down your spending habits for you, and that makes it a lot easier to see where you can cut back. If you get in the habit of really understanding your spending, budgeting for the near and distant future can be a lot easier.

If you’re spending less than you make, then you should be able to start saving every month. Put some away in emergency savings — a fund you can easily access if a big unexpected expense comes up — and put the rest toward long-term goals and saving for your retirement.

The traditional rule of thumb for emergency savings is to have three to six months worth of living expenses in an account that’s easily accessible — for emergencies or situations like a job loss. When you aren’t making a whole lot of money, saving can be tough, but it’s always possible.

If you’re having trouble finding money in the budget to save, start with a small amount each month — maybe 1% – 5% — and work your way up.

Monthly bills can quickly eat away at your paychecks, so spend some time deciding which ones you need and which ones you can live without. When you take the time to pay attention and reduce your spending, you can drastically increase your monthly cash flow — simply by making just a few easy changes.

That $2 (or often more) you spend on coffee every day adds up over time. If you’re buying coffee daily, making coffee at home can save you at least $50 – $60 per month — and a whole lot more over a year. There’s even a way to hack your expensive coffee machine you have at home and use cheaper brand coffee.

You never wear it as much as you think you will. There are so many ways now to buy designer clothing at discount prices, and seriously, no one will ever know (if you care) that you bought it on sale. Shopping at consignment shops can save you up to 90%, and that’s a lot of money back in your pocket. Check out sites like ThredUp , Gilt, Revolve and even the department store outlet sites can have some great deals.

If you like trying the clothes on first, and you’re up for a little digging, check out places like  Marshalls, Nordstrom Rack and DSW for designer clothing at up to 60% savings. 

We’ve all got stuff piled up in a closet somewhere and a lot of it could make you some extra cash. Check out what other people are selling the items for on eBay and go ahead and get rid of the things you don’t use. Gently used technology, clothing, sports gear and other items you aren’t using anymore (or never did) could add up to a nice sum of money.

Plus, there are tons of apps now that make it super easy!

It’s so easy to think I’ll always have time to save later — but time is money, folks! The early you start saving, the more time your money has to grow — giving you a much bigger chunk of cash in the future.

And you don’t have to save a ton. Start with baby steps, increasing your contributions every month or even every six months — and the increases are so small that you won’t even notice the money missing!

When it comes to saving for retirement, your best bet is to have the money automatically deducted from your paycheck so you never even see it in your account. That way, you won’t miss it.

For more details, check out Clark’s Investment Guide.

Using credit cards wisely can help you build up a strong credit score, which will save you a whole lot of money over time by getting you better interest rates on things like a car loan, mortgage and more.

If your student loans don’t have a high interest rate, spending all of your money to pay them off right now won’t save you a ton in the long run. It’s more important that you continue making your payments on time and put your extra money toward short-term and long-term savings.

Plus, student loan debt isn’t considered bad debt — like credit card debt. So it’s more important that you continue making on-time payments, while you prioritize paying off credit card debt and growing your savings.

If you’re having trouble making your student loan payments, there are options to reduce the amount you owe each month — and even have your loans forgiven.  Here are some options for paying off your loans, including loan forgiveness and income-based repayment programs.

If you don’t qualify for any federal programs, you may want to consider refinancing your loans. Here’s a guide on how it works and when it’s a good idea.

To learn more about your best options for student loans, check out our Student Loan Guide .

The average class of 2016 graduate with student loans left school owing  more than $37,000 — and that doesn’t include any credit card debt (which many college students accumulate during school). And while the cost of college isn’t getting any cheaper any time soon, there are ways to get a degree without getting buried in debt.

Here are just a few of the options out there to help you save:

Understanding health insurance seem like an oxymoron, but it’s important to understand at least some basics about your health insurance options in order to make sure you’re choosing the best plan that fits your needs and so your money is being spent wisely. Plus, keeping up with your health can save you a lot of money on bigger medical expenses down the road.

Check out our Health Insurance Guide for more on what you need to know.

Taking steps to protect your identity and your finances can save you a lot of trouble — and a whole lot of money— in the long run.

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