As a young adult, you already know your financial choices are important. Millennials (born between 1981 and 1997) face a tight job market, big student loans, and more. To minimize stress and achieve your personal goals, responsible decision-making is critical. Here are some tips to help…

Figure out your financial goals
Determine what’s important to you. Set goals for various periods of time.

For instance, short-term goals may include a new car or vacation; intermediate-term goals could include buying a home; and long-term goals may include saving money for a child’s education, or retiring by a certain age. Then, prioritize each goal by importance, and determine how much money you need for each.

Build a budget
To start, figure out what your currently monthly income and expenses are.

Then, be sure you understand which expenses are fixed costs (like rent or mortgage, groceries, transportation, and utilities) — and which are discretionary expenses (such as for movie tickets, restaurant dining, travel, and hobbies).

Now, compare your totals. If you’re spending more than you earn, you’ll need to make some adjustments. If you have extra left each month, you can put it toward savings.

Establish an emergency fund
Unexpected expenses happen. From medical costs to car repairs, you’ll find something is always popping up to throw off your budget. To account for these types of expenses, it’s a good idea to have an emergency fund.

How much you put in this fund depends on your circumstances. You’ll want to consider your job security, overall health, income, and debts. And remember, as circumstances change, you may need to adjust how much you’re allocating to this fund.

Be careful with credit cards
Using credit cards can help you build a good credit score so you can qualify for bigger purchases later — like a car or home. But you must pay your bills on time — and ideally, pay the full balance each month so you can avoid interest charges (which means you’ll pay more than the actual cost of the item).

Be sure to read the terms and conditions closely, and understand your interest rate and how it’s calculated. You may also want to choose a card offering rewards that can benefit you. For instance, some allow you to use reward points as a payment on the card — saving you money in the long run.

Paying existing debts
Wondering how to handle your student loans and other debt? Check your options, like Income-Based Repayment. Even if you don’t qualify, you may be eligible to refinance or consolidate loans to make payments easier on your budget.

Make good borrowing decisions
While you’re still paying off college loans, you may find a need to take on even more debt — for things like grad school, or a car. Be cautious before making a decision. Ask yourself important questions like:

• Is this purchase absolutely necessary? (For instance, is your current car falling apart, or could you drive it a few years longer?)
• Have you comparison-shopped to make sure you're getting the best possible deal?
• How much will this loan or line of credit cost over time?
• Can you afford to add another monthly payment to your budget?
• Will the interest rate change if you miss a payment?
• Get help from an app

There are plenty of financial apps out there. To find the right one for you, do some self-assessment: Do you need alerts reminding you to pay bills on time? Do you need help keeping transactions organized? Do you need to see all your accounts — bank, credit cards, investments, and loans — all in one place?

Make a plan
To be sure you’re not leaving anything out, you may want to talk to a financial adviser who can help you create a plan for all your short- and long-term needs.

Got questions?
Stop by any Horizon Bank branch or contact us today for Sensible Advice on handling your finances.