The 20’s something phase is a pretty tricky one. While you are just about to get on your feet for bigger and better things in life, a heaping pile of debts can be extremely discouraging, especially for you as a young adult.

Because we are just on that edge of the cliff where we bid goodbye to our teen years and sort of entering into realism, young adults in their 20’s can seem to be confused as never before. If you are in your early 20’s, you might have already started feeling the heat by now! And we don’t blame you.

Early 20’s is a very prime age, so let me just tell you this – this is the time you really need to pull up your socks and set things straight. And by that, I just don’t mean finishing your graduation or land in a high-paying job but avoid the bomb that devastates many – financial problems. It is understandable that you are still in the process of laying a foundation and may not be fully equipped to be handling your current financial situation. However, your actions today can really lead to a better tomorrow and future, just for you!

Here are a few but essential financial tips for 20 somethings, just like you who still don’t understand what you should ideally be doing with whatever money you have left.

#1.No Mom and Dad, please?!

This is probably the saddest way of breaking the ice to an early 20s adult but yes, you will have to stop relying on your mom and dad. And trust me; being self-sufficient is undoubtedly one of the first stepping stones to managing your own finances in a sound manner. Once you stop relying on your parents is when you will actually go out into the real world, earn a living, earn your money and understand your financial situation and risks in a better way.

So the next time your parents yell, “When are you going to become responsible enough?!”, you must surely give it a thought.

#2.Draw a line

Not on a paper, but draw a line to your monthly expenses. Or in short, set your budget just right. And this does not mean setting a budget to buy a car or an expensive phone. This only means to keep yourself in a restriction to how much you can spend on what. For example, you can divide your earnings amongst groceries, cosmetics, tuition fees, fuelling, eat-outs, and more.

You will your lifestyle better than anyone else. It is time you grow up, realize the nature and feasibility of your lifestyle, and with a heavy stone on your heart, draw a line for yourself.

#3.Stash all your money

Yes, literally have a secret stash with a small part of your money kept safe – for example, an emergency fund. Keeping some amount of money aside from your total earnings every month, and you will love the surprise you would experience when you will have to crack open that emergency bag, pouch or box in dire situations – however, just try not cracking open your emergency fund unless and until you really need to!

Emergency funds are more or less like your own little private savings account that is easy to access and which can help you sock away some percent of your monthly earnings quite effortlessly.

#4. Stay safe and stay insured

To keep your finances more intact and to avoid irrelevant expenses, get an insurance started. And before you end up with a really long ‘Why?!’ here is the deal – it would hurt you way less giving away 10$ into your insurance than having to pay thousands of dollars during any mishap, accident or other misfortune. Now that you have taken your finance in your hand, you will have to take your own responsibility too. And one of the sure shot ways to protecting yourself from mishaps is by getting yourself insured at the earliest.

Right from healthcare to education loans, this is a golden financial tip for all 20 somethings – get insurance, at the earliest!

#5.Set your financial documents right

Gone are the days when your parents are in complete possession of all your important documents such as birth certificate, social security number, and other official IDs that are needed to at least create a financial life for you. Keep a list of all your banking and investment accounts, household bills and insurance policies, custodial accounts, savings bonds, etc.

Don’t let such important documents hinder in the way of your financial grounds, and this is probably the least you could do for your own financial welfare.

Final words

Handling your own finances in your 20s is not rocket science. You might just actually start growing up once you start exploring the wonders of being financially independent in your 20 somethings. Initially, it might look as if things are falling apart, but with a little conviction and a few financial tips, you can easily keep yourself in a healthy financial control

James is a finance blogger and writes about personal finance tips and everything about money management.