Posted on: 17 February 2019
When you're young and single, you may not think much about financial planning. You might think that's for when you're established and have kids and a spouse relying on your income. However, financial planning is important for singles too, and in some ways, it's even more important. Here's a look at why.
You Don't Have A Spouse's Income To Fall Back On
Building up an emergency fund should be a top priority when you're single. If you lose your job or become ill and unable to work, then you won't have a spouse's income to cover your bills. Having several months of income in a savings account gives you peace of mind knowing you can handle any unexpected event life throws your way.
You Have A Chance To Build A Strong Future
When you're young and single, your main focus may be on having fun, and that's a good time in your life to take advantage of your freedom. However, you don't want to sacrifice your financial future. Without kids, a mortgage, and a spouse to worry about, you can put more money toward savings when you're single. Being single, you won't need a large home, so you can buy a more affordable house and pay down on it so you're ready to trade up when you get married and want to start a family. By taking advantage of your fewer responsibilities now, you can work harder on saving and growing your money so you're better off financially once you have a family.
You Need Someone To Handle Your Affairs If You're Not Able To
Another part of financial planning is to designate someone to handle your financial matters if you aren't able to due to an accident or illness. Normally, this responsibility would fall to your spouse, but if you're not married, then it could be your parents who handle your affairs. However, you want to name someone who is responsible and that you trust so the court doesn't get involved in your financial matters or healthcare decisions.
Financial planning is important for singles and young adults just as it is for everyone else. You may be unsure of what you should be doing, and that's to be expected since financial planning isn't generally taught in schools. Instead, talk to a financial planner to get advice on how much you should be saving, how much you should invest, and when's the right time to buy a home. Develop a plan that puts you on track to a solid financial future so one day your family will have the best life you can provide.Share