Your 20s is a decade where many lifelong habits are developed. Young adults can expect to experience enormous growth professionally, personally and financially, as shared to NPR by clinical psychologist Meg Jay, author of "The Defining Decade: Why Your Twenties Matter—And How to Make the Most of Them Now". As such, your 20s is a great time to create a strong financial foundation on which you can build for years to come.

Here are four financial habits that can benefit you for the rest of your life:

1. Start saving for retirement

When you're focused on the beginning of your career, as you are in your 20s, it can be hard to begin planning for the end of it. But, this is actually a great time to begin thinking about your departure from the workforce. Why? Because the earlier you start saving, the more money you could have during retirement.

There are plenty of options for retirement savings accounts. If your company offers a 401(k) with a matching program, take advantage of the free money. Otherwise, you can check out IRA options that you can open on your own. Whatever type of account you choose, the most important thing is that you're saving.

If you would like to discuss the possibilities, one of OnPoint’s Financial Advisors could help point you in the right direction.

2. Keep your budget slim

During your college years, you may have scrimped and saved whenever you could to keep your costs low. Don't stop doing this just because you're out of school and earning a regular paycheck. The money you save now can benefit you in the future, whether that's in the form of a vacation you'll take in six months, a car you'll buy in five years or your child's college education in 18 years.

One way to begin doing this is to review credit card and account statements at the end of every month. Highlight where you strayed from your budget and determine how you can avoid that in the future. For example, did you spend too much on mid-week lunches? Make a goal to begin bringing your own. Did you spend more on your car than you expected? Try carpooling with co-workers or exploring public transportation options to cut costs in that area.

3. Organize your documents

Over time, you'll inevitably collect a variety of financial and legal documents. Whenever you start a new job, open a new bank account, buy a house or pay your taxes, you'll deal with documents. When you make tax-deductible investments like a charitable contribution or a job-related move, you'll also need to keep receipts.

In addition to the paperwork you'll acquire over the years, you also have legal documents like your Social Security card, birth certificate and potentially your marriage license; each of these documents serves a specific purpose and should be stored safely. According to Business Insider, time limits for many of your important documents include:

  • Forever: tax returns, investment account annual statements, home purchase receipts and receipts for high-value items
  • Seven years: tax return preparation documents like 1099 statements, W-2s and charitable contribution receipts
  • One year: pay stubs, investment account statements, medical receipts and canceled checks

Don't let these documents clutter up your kitchen counter or get lost in a disorganized box. Keeping them organized will help you ensure you always have access to critical information. Invest in a safe or locking file cabinet to keep your documents secure. Keeping your documents secure can also help prevent identity theft.

4. Identify specific financial goals

We all have life goals. In your 20s, identify which ones are most important to you.

Is it to buy a house? Start a family? Begin a sports car collection? Retire to France one day? What about a hobby farm?

Whatever your major life goals are, identify them, estimate their cost and begin working toward them. Keep your savings dedicated to these goals in its own separate account; this will reduce your likelihood of spending it during a tough financial time or on a spontaneous large purchase. Plus, if you choose to keep your funds in interest-bearing saving accounts like a certificate of deposit or a money market account, you can watch your money grow in time.

Are you working to build better money habits? Open a savings account with OnPoint to make progress on your short- and long-term financial goals now.

Disclosure

Securities offered through Raymond James Financial Services, Inc., Member FINRA/SIPC and are not insured by credit union insurance, the NCUA or any other government agency, are not deposits or obligations of the credit union, are not guaranteed by the credit union, and are subject to risks, including the possible loss of principal. OnPoint Community Credit Union and OnPoint Wealth Management & Investment Services® are not registered broker/dealers and are independent of Raymond James Financial Services, Inc. Raymond James privacy policy. Investment advisory services offered through Raymond James Financial Services Advisors, Inc.

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Any opinions are those of the author and not necessarily of RJFS or Raymond James.

Roth IRA owners must be 59½ or older and have held the IRA for five years before tax-free withdrawals are permitted. Like Traditional IRAs, contribution limits apply to Roth IRAs. In addition, with a Roth IRA, your allowable contribution may be reduced or eliminated if your annual income exceeds certain limits. Contributions to a Roth IRA are never tax deductible, but if certain conditions are met, distributions will be completely income tax free. Unless certain criteria are met, Roth IRA owners must be 59½ or older and have held the IRA for five years before tax-free withdrawals are permitted. Additionally, each converted amount may be subject to its own five-year holding period. Converting a traditional IRA into a Roth IRA has tax implications. Investors should consult a tax advisor before deciding to do a conversion.