young adults

As a young adult, it is important to plan your expenses and savings in a manner that compliments your financial plan and supports your life goals and objectives. It is always better to start planning earlier than delaying such a critical decision. A right financial decision can be the key to a secure future, whereas wrong decisions can set you back on the path of financial freedom.

Current environment

Prevailing Condition

The current market scenario has been tough on employees, especially for young adults as a majority of them do not have much experience. It is noted that during the past recession 15% of young adults in their 20s were out of work and many are still struggling to get a kickstart. [1] Unfortunately, many young adults think that finding financial freedom will take longer as compared to their parents. This could be an effect of fast-rising prices and relatively slow growth in salaries and wages.

Spending Behaviour

A shopaholic
A shopaholic

The society is harsh and it will treat you unfairly even if you are a kind person. It judges people’s success based on the things they own. This has developed a spending behavior among young people where they tend to buy things which are not necessary. It is advised that 20% to 30% of your salary must be saved. Whereas, most young adults only tend to save 11% from their monthly income. [2]

Young adults have fallen prey to relative materialism (i.e. buying goods just because your peer owns them). With the largest millennial population globally, Indian youngsters are motivated towards spending rather than saving. [2] Sadly, 7 out of 10 young adults, maybe even you, think that covering monthly expenses is financial stability. [1]

A simple and easy solution

Actionable Solution

A resolution to excessive and unnecessary spending is to focus on loans and savings. Suppose you want something, then work out how much time will it take to repay debt. Or if you use your savings, then how much time will it take to increase your saving by the amount that is used to buy that particular product.

To put things into perspective, let’s assume that you are saving for a 5-day vacation in Goa, think ….‘any impulsive buying will reduce your trip by a day or two.

The purpose of this action is to induce a habit of comparing short-term joy with long-term goals.

It is imperative to remember that when you borrow money. You do not borrow it from a bank, you borrow it from your future self. So, whenever you borrow for an unproductive purpose, then think as if you are constraining yourself in the future.

The money you earn is not the only solution. To overcome long-term financial goals, saving and investing are necessary. You must be true to yourself regarding your ability to properly judge investment opportunities.

If you are a first-time investor then you must seek advice from a professional about the starting point. Additionally, if you have invested before then having a second-opinion could get you better results.


[1] M. P. Cussen, “Money Habits of the Millennials,” 25 June 2019. [Online]. Available: [Accessed 2019].
[2] A. Talreja, R. Wahi, S. Ghosh, D. Marwah, and B. Verma, February 2018. [Online]. Available: [Accessed 2019].

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