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5 money habits to master in your 20s

It’s easy to get into the habit of living from day to day, with all your money just disappearing by the end of the month. After all, life is for living.  But if you have plans for the future, now’s a great time to be working towards them. Whether you’re thinking about buying a home or going travelling, these 5 habits will help you get headed in the right direction.

1. Save into your pension

Pensions is one of the more tax efficient ways for saving for your retirement. Also, in a workplace pension your employer may match the money you pay in, so it pays to make the most of it. Of course, your retirement may be a long way off, but your future self will thank you for being prepared.


2. Build your emergency savings pot

If you don’t have any savings at all, it makes sense to start by building up a reserve to use in emergencies. How would you cope with a large unexpected bill?  What If you need to call out a plumber? Putting away a small amount every month can soon add up. And of course, your emergency pot should be in a savings account that gives you instant access.

3. Learn how to budget

Budgeting is just another name for living within your means. A good place to start is by breaking down your spending every month. Some things, like your rent, will be fixed (unless you move) but how much do you spend on coffees or lunch, for example? Reducing your non-essential spending is a good way to increase the amount of money you have at the end of the month. And if you have debts, think about ways you can manage them.

4. Spend money on things that enrich you

You may not believe it, but in your twenties you’ve probably got more time and money to spend on yourself than you realise. So now could be a more affordable time to go travelling, or an easier time to get any qualifications or training that you want. By spending on expanding your experience and knowledge, you could find it gives you a more rewarding future.

5. Get comfortable with investing

Once you’ve got any debts under control and built up an emergency fund, it’s worth thinking about making your money grow. Investment gives you the potential to do just that – and with NatWest Invest it’s simple.

Start with £50 a month, choose a level of risk you’re comfortable with and we’ll do the rest. Whatever plans you have for the future, it’s well worth thinking about. 

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