Financial Independence Guide for Young Adults

It’s never been easier to find the resources you need to achieve financial independence. With a smartphone in hand, you have access to a repository of knowledge and financial literacy courses that people 20 to 30 years ago could never have imagined. However, many young people are still finding it difficult to get ahead.

With that in mind, we compiled a list of the best strategies for building solid, long-term wealth. You’ll find details about how to decipher which accounts and strategies are right for you, as well as tips for avoiding common mistakes and pitfalls that could hinder your growth.

What should I do first to be financially independent? Find the right partner.

The first and most important step on your path to financial independence is selecting the right bank. For young adults, this generally means finding an institution that offers low-cost young adult or student checking accounts that balance utility and affordability. Beginner checking accounts typically don’t offer the benefits you’ll find on premium accounts, but make up for it with lower fees and a more intuitive user experience.

BankSouth has over 75 years of experience helping people of all ages and backgrounds achieve financial stability, and offers the tools and professional advice you need to set yourself on the path to success. One beginner checking account with mobile banking is our Young Adult checking account. An ideal checking account for teens and college students in Georgia, it’s flexible enough to fit your needs without charging a monthly maintenance fee or minimum balance requirement.

BankSouth checking accounts also offer access to digital and mobile banking for students, giving you a leg up when you’re on the move.

How do I build a budget and track my spending?

One of the best ways to curtail out-of-control spending habits is to establish an easily achievable budget. Once you’ve got a clear view of your income and your necessary expenditures (rent, bills, school supplies, etc.), you can adjust the amount you earmark for long-term and standard savings accounts, with the remainder being your “play money” for the month.

A great starting point is finding a low or no-cost savings account that lets you contribute as much or as little as you like, such as our Young Adult savings account. A separate account helps reduce the urge to spend what you’ve earned right away and keeps you on track to meet your long-term goals.

If you’re having trouble establishing a balanced budget, consider taking advantage of financial literacy courses or leveraging BankSouth’s resources for financial education.

How do I start investing?

Low-cost, low-risk index funds and money market accounts can be a sound starting point for budding investors. These allow seasoned professionals to structure a diversified portfolio that can safely earn interest without the need for micromanagement. Safe investment strategies are crucial to developing long-term stability and offer an alternative to investing in short-term strategies that carry far greater risk.

Should I think about saving for retirement?

One of the most critical decisions you can make in life is to start contributing to an Individual Retirement Account* (IRA) early. You might have heard of compound interest before, and the scale at which small contributions add up often boggles the mind.

For example, imagine two people making the same $5,000 annual contribution to their IRA. One is 20 years old and the other is 30. By the time they reach the same retirement age, the difference between their accounts could be over half a million dollars, despite the younger investor only contributing $50,000 more to their account. This contribution can end up being the difference between a comfortable, early retirement, and an additional decade of work.

*Investment and Insurance Products are not a deposit product, not FDIC insured, may lose value, not bank guaranteed, not insured by any federal government agency.

Ready to Build a Strong Financial Foundation?

Find your nearest BankSouth location today or open an account online to start your journey toward financial independence. Our representatives are at the ready, and we can’t wait to meet you!