When you are just starting out in life making provision for the future does not sound so important, but it is.
Are you in your twenties? Done with studying for now, in your first or second job, building a career and thinking about becoming responsible, but not quite ready for it? There are some steps you can take now that your future self will thank you for.
“Your twenties can feel like a time of financial chaos with juggling entry-level salaries, student debt, rent and social pressure. However, the reality is that the financial foundations you lay now will determine the level of stability, freedom and security you will have later,” said PSG’s Bianca and Annika Strydom, who believe that the habits and decisions people make in their twenties can shape their financial trajectory for life.
“It ultimately comes down to three key financial habits. The first and arguably most important is living below your means. If your expenses are consistently higher than your monthly earnings, you are in for major trouble down the line,” Bianca says.
Annika agrees. “Once you have the first habit down, you can focus on the second habit of saving before spending. By setting up automatic transfers to a tax-free savings account or retirement fund, you can ensure that even small amounts grow consistently.”
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Importance of budgeting in your 20s
The third non-negotiable habit, according to the sisters, is budgeting.
“Having a budget, whether through a spreadsheet or an app, helps you see where your money is going. When you can visualise your spending, you can make intentional financial choices,” Annika says.
They also believe it is important to get a financial safety net in place as a solid emergency fund is the basis of financial security.
“Before even thinking about investments and retirement, build up an emergency fund that can act as a buffer for any unexpected expenses that may arise. Ideally, you should aim to cover three to six months’ worth of essential living expenses,” Bianca says.
Annika acknowledges that this can feel overwhelming when you are earning an entry-level salary or repaying student loans.
“Start small with consistent monthly contributions and top it up with bonuses, salary increases or birthday cash. Keeping it in a separate high-yield savings account means your money grows while staying accessible.”
They also point out that it is important to stay on top of your credit. Understanding how credit works is vital in your twenties, as it affects everything from renting a flat to qualifying for a loan.
“To build a good credit profile, pay your bills on time, every time. One missed payment can hurt your score for years,” Annika says.
Bianca’s advice is to start with a manageable account, like a credit card or a store account.
“Use it responsibly and pay it off in full each month. But do not max it out and avoid applying for multiple accounts at once as that can signal financial stress to lenders.”
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If you manage debt in your 20s, less to worry about later
Managing debt wisely is just as important as building savings. “It is not an either/or scenario. Pay the required minimum on any credit to stay in good standing, while also building your emergency fund steadily over time,” Bianca says.
They also agree that small steps pay off later. Some of the smartest financial moves you can make in your twenties do not directly involve money.
“Now is the time to invest in yourself. The earlier you upskill yourself, the greater the potential return through higher earnings over your lifetime.”
Annika also encourages using any spare time to experiment with side hustles. “You have flexibility and fewer commitments now and therefore it is the perfect time to test out income ideas that could grow over time.”
And they say you must not forget about financial literacy.
“Learning how to manage your money is one of the best investments you can make. The knowledge you build now will serve you for decades,” Annika says.
Above all, the twins stress that you must never underestimate the power of time.
“Time is on your side, but this will not always be the case. Therefore, start where you are, with what you have,” Bianca says. “Your future self will thank you for it,” Annika adds.
