As much as society deems money an insignificant measure of happiness, it can’t be denied how it has become a vital means of survival. Money is essential to life, but it doesn’t grow on trees. Hence, when it comes to stability, financial independence is a commodity.
However, for a young adult facing unique challenges and juggling different priorities, securing this is a huge obstacle. It can be overwhelming to find the right balance between saving and living life as how every young adult should. Fortunately, with the right budgeting strategies for young adults, taking control of finances and living a thriving life can be possible.
How Can Young Adults Better Manage Their Money?
Financial independence for young adults is beyond knowing how to handle money properly. It’s above the understanding that simply because one is getting money in doesn’t necessitate spending money out. Financial independence isn’t only about who gets to save the most money in a period of time. Instead, it’s mastering sustainably managing one’s finances. It’s knowing how to allocate money to different demands of life while still allowing people to enjoy living.
In fact, according to Wilbert Guilford Jr., a Certified Financial Planner and Public Accountant, financial independence is best achieved through education. Giving people all the information they need empowers them to make better, smarter decisions. As with everything else in life, people do better when they’re well-versed in the things they’re undertaking.
This is why Wilbert Guilford has done his best to incorporate as much financial knowledge in his book Financial Planning for the 99% in hopes of helping people better handle money.
5 Budgeting Strategies for Young Adults
All the advice in his book is essential to young adults struggling with financial accountability. It’s tough, but it’s necessary. Hence, to help them get a better footing, here are some budgeting strategies for young adults to practice in 2025.
1. Set Clear Financial Goals
At the top of our budgeting strategies for young adults is encouraging them to set clear and achievable goals. With a clear vision of what they want, they will become more motivated to take actionable steps. Whether it’s paying debt or building an emergency fund, having clear goals will help them better divide their finances, setting a purpose for every money they get.
At their age, young adults can be quite visual. They would need to see a visible list of their goals to remind and align themselves with what they believe truly matters. This will not only be a constant reminder of what they should be working for but also urge them to do better and take more responsibility. These goals will serve as a compass for their financial decisions.
2. Track Spending
Young adults should not only visualize where their money is going but also track where their money has been spent. One of the most overlooked budgeting strategies for young adults is tracking their money. Every cent and dollar should be tracked and categorized according to expenses. This way, any unnecessary spending will be highlighted, and people will know where they should limit themselves the next time.
3. Create a Realistic Monthly Budget
Similar to setting clear, bigger goals, young adults should cut these down into more consumable data. They can begin by calculating and tracking their monthly expenses and income. By having complete data on the money they have and typically spend, young adults see a clearer picture of any patterns or habits they need to cut off or improve.
One of the most effective budgeting strategies for young adults is to list and divide their expenses into different categories, from fixed (rent, utilities, necessities) to variable (leisure, entertainment, shopping). This way, they can see a clearer picture of where their money usually goes and how they can better budget their income for these.
4. Embrace the 50/30/20 Rule
This is among the most popular and straightforward budgeting strategies for young adults. This works by allocating 50% of their income to needs, 30% to wants, and 20% to savings or any existing debt repayment. This system helps ensure everything is covered while still providing young adults the opportunity to enjoy life. This is a solid and effective way to manage their money.
5. Prioritize an Emergency Fund
Aside from ensuring every need and want is budgeted, it’s advised that young adults should also keep a portion of their income in an emergency fund. Life is unpredictable, and there’s no saying when people would need a safety net protecting them from unexpected expenses like medical bills. There’s no better budgeting strategy than preparedness.
Young as they are, young adults can still be hit with different medical conditions or accidents, and they need to be prepared for them.
The Best Money Management Tips for Adults
It pays to be well-versed, even in discussions of financial responsibility. Hence, if there is a budgeting technique that will stand out among the rest, it is education. Young adults should be open to talking or taking consultations from financial planners to help them set a better footing with their finances.
Mastering everything can be daunting, but with the right budgeting strategies for young adults, independence is achievable. By tracking expenses, setting goals, and building a concrete financial foundation, they can shape their financial future.
Start small, grab a copy of Wilbert Guilford’s Financial Planning for the 99%: Financial Planning for Those Who Need It Most. Make the most of 2025 and take control of money!
