Setting Yourself Up for Success in Your 20s
A guide to money, career, and building momentum in your 20s
There are a lot of moving pieces in your 20s: money, career, and the pressure to figure it all out. This is everything I wish I understood earlier about building momentum before life gets more complicated.
Here’s a practical guide to help you get clear on your goals, master your finances, and set yourself up for success early on.
Take Inventory of your Current Situation
Before making the decision to change direction with your finances or career, you have to understand where you are currently. This is the starting point for your plan.
Start by taking an honest look at where you stand today. That means knowing your income, expenses, any debt you have, and what you’ve saved or invested.
You’ll also need to evaluate your current path. Whether you’re in school, early in your career, or still figuring things out, think about where you are in life.
You don’t need to have a perfect roadmap, but collecting the details and writing down your current situation will provide clarity and future direction.
Without understanding the current reality of our situation, we cannot take the next step towards your goal or build a plan. Taking self-inventory is the first step towards success in your 20s.
Once you know where you are, the next step is understanding how your money is actually working for you.
Track Your Spending
Tracking your monthly expenses is essential when creating a plan for your money. Without tracking, you don’t know how much you have coming in and how much you have coming out every month.
Are you already tracking? If you haven’t done so already, read my post about budgeting that will help you get started in the right direction.
Track Your Net Worth
Net Worth = Assets - Liabilities
Simply put, net worth is what you own minus what you owe.
You might own (assets):
Investment accounts, real estate, savings or cash, car, personal items, etc.
You might owe (liabilities):
Student loans, credit card debt, car loans, personal loans, mortgage, etc.
Tracking your net worth gives you a clear snapshot of your financial position. More importantly, it allows you to measure progress over time, so you can see whether your decisions are actually moving you closer to your goals.
Once you understand your current financial picture, the next step is deciding where you want to go.
Get Clear on Your Goals
In order to succeed, you need direction. Once you understand where you stand with your income, spending, and net worth, the next step is getting intentional about where you want to go. Success doesn’t happen by accident; it’s the result of clarity and consistency. Start by brainstorming all the things you’d like to achieve/work towards (no goal is too crazy).
The simple act of putting your goals on paper turns vague ideas into something real.
From here, pick 1-3 financial goals that matter most right now. Start with one, build momentum, then stack more on top. Progress beats trying to be perfect.
Here’s is a brief order of operations that can help you create an outline for your goals list:
Build a mini emergency fund (1 month living expenses)
Get your company match for your 401k
Open an IRA and automate small contributions (even if it’s $20 per month)
Pay off high interest debt (8% or higher) *think credit cards
Build a fully funded emergency fund (3-6 months living expenses)
Increase your investing contributions to your IRA
Open and invest in a brokerage account
Once you’ve picked your first goal, the next step is to reverse engineer it. Start with the end number and the timeline, then break it down into what you need to do each month, week, or even daily to get there. This is what turns a goal into something you can actually follow through with.
Let’s say your goal is to have $6,000 saved in 6 months and you already have $3,000. That means you need to save the remaining $3,000 over 6 months:
$500 per month ($3,000 / 6)
Or $250 biweekly ($3,000 / 12)
or $125 per week ($3,000 / 24)
You can see now that saving $125 per week for 6 months will get you to the exact goal you set, instead of a general statement saying “I want to save $3,000.” After breaking it down, it feels much more manageable.
Open the Right Accounts
With your goals in place, the next step is opening the right accounts so your money has somewhere to go.
High-Yield Savings Account
This is where your short-term money should live. Whether it’s an emergency fund or a near-term purchase, it keeps your cash accessible while still earning more than a traditional savings account. You can learn more about this in this HYSA Guide.
Roth IRA
In 2026, there’s no excuse why you haven’t opened a Roth IRA. There’s so much information out there to help you get started. I wrote a Complete Roth IRA Guide on how to open one and begin investing. If you want to be financially free one day, you need to start investing.
401k
The easiest thing you can do is log in, activate the plan, and make sure you’re getting your company match, then set it to automatically increase your contribution by 1% each year. You’ll hardly even notice the extra 1% it in your paycheck, but it’s one of the simplest ways to consistently build your investments over time without even trying. Learn everything you’ll need to know about your 401k in this guide.
Brokerage Account
A brokerage account gives you flexibility beyond retirement. This is where you can invest for goals like early retirement or saving for a down payment, that’s how I personally use mine, and it gives you more control over when and how you access your money.
HSA
For some people, an HSA can be a great account to have. It offers strong tax advantages for health-related expenses, but not everyone qualifies since it requires a high deductible health plan (HDHP) so it’s something to look into and understand before opening.
Automate Your Finances
Once you’ve set your goal and broken it down, automate it to make your life easier!
No matter what the goal is, set up recurring transfers, deposits, or payments so it happens without you thinking about it.
The easiest way to do this is to line everything up with your paycheck. If you get paid bi-weekly, have your money move where it needs to go as soon as you’re paid (into your investment account, high-yield savings, or toward debt) so your goals are being funded first, and whatever’s left stays in your checking.
For example, if your goal is to max out your Roth IRA at $7,500 for the year (2026), that breaks down to:
$625 per month
About $288 every two weeks
About $144 per week
Set that up to happen, whether through your brokerage or your bank, and now you don’t have to rely on remembering or willpower, you know it’s getting done.
Automation will make your life a whole lot easier.
Trying Things Before You Have It Figured Out
This part isn’t always easy, and you don’t need to have everything figured out right away. It’s more about being willing to try different things, learn as you go, and make decisions that put you in a better spot over time. You’re not locked into one path, you’re just getting started.
If you’re in school, working while you’re in college can go a long way. Even 15–20 hours a week helps you build discipline, gain real work experience, and stay ahead financially. It might not be ideal in the moment, but it gives you more flexibility later and keeps you out of excessive student loan debt.
Living at home in your early 20s is another example of an early sacrifice. This doesn’t make sense for everyone, but if it’s an option for you, it can be a great way to save money while figuring everything else out. The key is to use your time wisely while living at home because it can set you up way faster than trying to do everything on your own right away.
If you do decide to live at home, give yourself a rough timeline of how long you want to live there. Maybe it’s just 6 months, 1 year, or 2+ years.
Your career matters more than people think. Your income drives a lot of your financial decisions and your job can add to your life or be a huge cause of stress. Many of us in our 20s don’t know exactly what we want our career to look like, but trying different things will help you get there faster.
For me, coming out of college, I was deciding between going into wealth management or real estate. I committed to working in finance for one year, told myself I’d give it a real shot, and see how I felt. I ended up not enjoying it, so I made the switch to real estate.
Here’s the takeaway: if I didn’t make that commitment to try that path, I wouldn’t have found out that it wasn’t for me. If something doesn’t feel right, make the change sooner rather than later.
You don’t need to have it all mapped out, but you do want to be intentional. Make a decision, give it time, and adjust. The more you’re willing to think ahead and be a little calculated early on, the more options you give yourself later.
Review and Reflect
If you’re already investing and working towards your goals, it’s important to review your progress and investments. We’ll focus this part on investments. You’ll likely adjust your asset allocation over time.
Asset allocation is just how your money is invested across your accounts, and what percentages belong to stocks vs bonds.
Figuring out your own asset allocation depends on your risk profile. If you have a lower risk tolerance, you likely hold a larger percentage of your portfolio in bonds than someone who wants to take on more risk.
A common starting point for someone in their 20s is something like 80–100% in stocks and 0–20% in bonds. However, this depends on your goals, your timeline, and how comfortable you are with market ups and downs.
The younger you are, the more risk you can afford to take because you have time to recover and grow your investments. Stocks tend to be more up and down in the short term, but they’ve historically offered higher returns over the long run and typically make up the larger portion of younger investors’ portfolios.
If you’re trying to figure out what works for you, start by asking a few simple questions: How long until you need this money? How would you react if your portfolio dropped 20 or 30%? Your answers will help guide how aggressive or conservative you should be.
As you move through your 20s and into your 30s, your allocation doesn’t need to stay the same forever. Review your asset allocation every year and make sure your portfolio fits your current goals!
Keep Learning
Most of us did not learn about personal finance in school, we need to do the learning on our own. I want to encourage you to be a lifelong learner, there are endless ways to increase your knowledge on personal finance. Books, YouTube, and podcasts are all great ways to learn about personal finance. Spotify even has audiobooks about investing and personal finance that are included with your membership! The goal is to learn and implement the things you now know to improve your financial position.
If speaking to someone 1:1 is better for you, I’m here to support you and you can book a consultation with me.
Understanding Coast FIRE
I want to introduce you to the concept of Coast FIRE, where you invest aggressively early on and reach a point where your investments can grow on their own to fund your retirement, without needing to keep investing at that same aggressive level forever.
In other words, you’re not financially independent yet, but you’ve built a strong enough foundation that time and growth can keep you on track for retirement.
Here’s a simple way to think about it:
Let’s say you want $2.5 million by age 65 and you’re currently 25, aiming to hit Coast FIRE by 35. Assuming a 9.5% annual return, you’d need roughly $330K invested by age 35 for that to grow to $2.5 million on its own. To get there, you’d need to invest around $21K–$22K per year for 10 years.
This won’t be easy, but can be a pursuit worth considering.
The money invested gives you flexibility to change career paths, take a gap year, explore passions, travel, or step back from work without sacrificing your retirement timeline.
What we can take away from this is that the earlier you start and the more intentional you are upfront, the more options you give yourself later.
Lessons I’ve Learned So Far
Early on, I didn’t really have a strategy when it came to investing. I was chasing the hype, putting money into different cryptocurrencies because I saw other people talking about them and claiming big returns.
I didn’t really know what I was doing, and I didn’t have a plan. Some worked out, most didn’t, and looking back, the opportunity cost of this was huge.
I’ve learned that following a system matters way more than chasing what’s hot. If I had focused on investing consistently into something simple like an ETF, I’d be in a much better position today.
One thing I did get right was investing in myself. Pursuing professional licensure in college and after college at my job in finance and real estate increased my income and opened up doors for me. They did require time studying and had upfront costs, but they were definitely worth it.
That’s something I’d encourage anyone to think about: if a certification, skill, or license can increase your income over time, go after them.
Closing
Your 20s aren’t about having everything figured out, they’re about building direction.
You don’t need perfect timing or perfect knowledge. You just need a little bit of momentum and a willingness to adjust and improve as you go.
Because in the end, it’s not about doing everything right, it’s about putting yourself in a position where your future self has options.
And remember this, life happens. You can plan everything out and end up in a place you never expected.
“In their hearts humans plan their course, but the Lord establishes their steps.” - Proverbs 16:9
This content is for informational purposes only and should not be considered financial advice. Always do your own research and consider reaching out to a professional if needed.
