September 6, 2021

Top Things You Should Save For In Your 20’s

If you're in your 20's and you're feeling lost in the world of personal finance about what you should do, well this is a list of the top things to save for in your 20's. Trust us your future self will be thankful if you follow these tips.

12 min read

Qoins Staff


Your twenties are that time of your life when you are stepping out into the world and bursting onto the professional scene. You are either fresh out of college and looking for a job or have just begun your career. Your first job is like your maiden brush with self-earned money. It gives you a feeling of being on top of the world. For the first time in your life perhaps you start feeling so independent and liberated that you begin to indulge in no-holds-barred spending.

You also keep switching jobs in quick succession in the initial years with the hope of amassing money, sufficient to meet all your personal needs. For some years, this experience can be rewarding as it gives you a taste of newfound success. But as you grow older, you tend to slow down. And by the time, you are in your 40s, you already feel worn out. The enthusiasm of the initial years is gone and you are too overwhelmed with additional responsibilities.

This is when you turn to your savings, only to find you have nothing kept aside for the future. And the feeling of still having to slog relentlessly hard for an unknown number of years can get the better of most of you.


What should you do?

To avoid such a turn of events, we advise you to make hay while the sun shines. Plan well and get into the habit of saving while you are starting out. This will help you head into the future with more confidence as you would have a fallback option in case something untoward happens. Also, your life will be much more organized, you can live more peacefully, sustainably and give others around you a life worth living for.


Things you should save for in your 20s


Retirement and Investment

Thinking about retirement plans in your 20s can be quite challenging. But none of us know for how long our bodies will allow us to work. It is important to have enough savings set aside for retirement. And the earlier you start saving, the faster your money will grow. You can contribute to retirement savings plans like 401(K) if your company offers one. There are other options, too like IRAs, etc. You can explore them and contribute at least 10 to 15% of your income toward these retirement savings plans. You may also start investing in stocks, bonds, mutual funds, etc.


Adding new skills

Acquiring new skill certifications in addition to your existing degrees can be significantly useful in the job market. So you can save a part of your monthly income to finance these skill-enhancing courses or certifications in the future to increase your professional viability. For example, a marketer can become Apple Search Ads certified, or Google Search Certified that adds layers of education towards your current and future roles. Reforge courses are another example of incredible educational certifications meant for career advancement. 

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We all love to nurture our hobbies and passions. But financial constraints can sometimes deter us from pursuing them later on. For example, you may be someone with an interest in photography. And you may have your eyes set on a camera that is too exorbitantly priced. Purchasing the accessory from your salary would mean a big dent in your monthly expenditure. But if you already have some money saved for this, you can go all out and have it added to your photography paraphernalia without a trace of guilt.



Having a home of your choice is like a dream come true. So if you are planning to go for it in the future, set a budget first. Then calculate your down payment. Gradually, start saving for your down payment which is 20% of the purchase price of your home. The more you save the better it is. Because this way your loan amount will also come down significantly and your other expenses of moving into a new house will also be taken care of.


Contingency fund

Emergencies come unannounced. So having money saved for contingency situations like hospital admissions, medical treatments, car repairs, etc can spare you the mental trauma that comes with the huge expenditures incurred from these unwarranted situations. According to experts, you can deposit three to six months of your salary into an emergency fund. These savings accounts should be high-yielding ones that allow you to withdraw money several times a month without charging any penalty.


How to achieve your financial goals?

Follow a budget - To avoid overspending, create a budget and follow it religiously. This will help keep a check on your income and expenditure and put a curb on overindulgence.


Reduce your debt - If you have huge student loans to pay off, set up a fund toward that. You must also try to repay any credit card debt that you may have. There are many repayment plans available that might help in reducing your monthly expenditures on loan repayment.

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Depending on your salary, you can start by saving a little in the beginning. As your income goes up, you may increase your contributions. An easy way to hack this is to become comfortable with budgeting percentages rather than dollar amounts. For example, if you’re auto-saving 20% per month towards a home, an increased income requires no additional effort, if anything you can now increase the percentage to increase the savings even further. Without adjusting your percentages, using this method will ensure that you’re staying away from lifestyle inflation by simultaneously increasing your contributions to all financial goals as your income increases. So if you can refrain from running amok with money early on, life will make sure you get a good return on this crucial investment.

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