10 Personal Finance Goals You Need to Achieve in Your 20s

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Everyone wants to be financially independent, but not all of us get there before we hit 30. Good advice and having some concrete goals in mind can help set you on the path to be more secure in your finances. There are many ways of setting and achieving your goals, of course, and everyone’s needs may be slightly different. But it’s best to start somewhere, with the basics. So, here’s a quick rundown on 10 of the personal finance goals you need to achieve in your 20s, to set yourself up for success in your 30s and beyond.

What personal finance goals should you have in your 20s?

  1. Establish an Emergency Fund
  2. Sort Out Your Credit Score
  3. Find the Right Job
  4. Start Saving For Retirement
  5. Cut Your Costs
  6. Pay Off Your Debt
  7. Establish and Maintain a Budget
  8. Get Insurance Coverage
  9. Buy Property
  10. Start Saving

#1 – Establish an Emergency Fund

You may think that nothing bad can happen in life, but it often does. And it will. Having the financial means to cope with a disaster at home (new water heater, anyone?) or your personal life is essential to reaching your long term financial goals. There’s nothing worse than thinking you’ve got it all under control, just to be hit in the face with the unexpected. Don’t let this side of your long term financial goals fall by the wayside.

If you never need to dip into your emergency fund, then that’s amazing. If you do, you’ll be so thankful you put the money aside. It also doesn’t hurt to always keep a little cash on hand for emergencies, too! Not having an emergency fund can stop you in your tracks and lead to borrowing and debt. Nothing will throw your life off course more than not having all eventualities covered. That’s why it ranks at the top of our list of personal finance goals to achieve in your 20s.

#2 – Sort Our Your Credit Score

Don’t let student loans and credit card debt ruin your credit score. Get online with a reputable third-party or the credit bureaus directly and get a copy of your credit report. When you know your score, it’s way easier to repair and improve it.  This might mean your short term financial goals may include paying something off, but you’ll reap the benefit of cleaning up your act. Look at your credit report bit by bit, and work out a strategy for improving it. This might take some time, but it will definitely be worth it in the long term.

Paying off your debt, correcting any incorrect information, and paying bills on time are key to improving your credit score and overall financial standing. With an improved credit report, you’re more likely to get accepted for any financing you need in the future, like a mortgage, car loan, and similar. You’re also far more likely to obtain that financing at a reduced interest rate. If credit agencies, banks, and other lenders know you’re good for the repayments, you reap the rewards, with the cost of borrowing being less for you over the long term. The sooner you start on managing and improving your credit score, the better off you’ll be, so this is definitely an important personal finance goal for your 20s.

#3 – Find the Right Job

Getting the right job can be key to reaching your long term money goals. Doing something you enjoy and are dedicated to makes it easier to stay on an even financial path. Job security and the ability to climb the career ladder are far easier in the right job.

In the wrong job, you’re likely to chop and change, moving from position to position. This may mean never really having the chance to progress through the ranks. Doing something you hate is also likely to lead to more unnecessary spending as you attempt to buy happiness with material items, waste money on lots of take-out food, and so on. You may also end up spending more on alcohol and therapists! Seriously, though, the right job can really help you with your personal finance goals, as well as your overall well-being and happiness.

#4 – Start Saving for Retirement

Yes, it may seem a little dramatic to save money for your retirement in your twenties when you should be out having fun. However, you can still go out and have fun while putting away funds for your golden years. You may already have a pension fund through your employer, though that is rare these days. More likely, your employer may contribute towards a retirement account, like a 401(k), which you should contribute towards as well. This is especially important if your company matches some of your contribution – that’s essentially free money. Find out more on 401(k)s in our introductory guide, and you’ll see how it all works.

You can also set aside money on your own via options like an IRA, decreasing your tax burden and setting yourself up to have a good nest egg for your eventual retirement. The sooner you start saving, the more time that money has to grow, and compound interest, dividends, and reinvestment are incredibly powerful forces. Starting a retirement account – even with only a small amount of money – is a must among personal finance goals in your 20s.

#5 – Cut Your Costs

Cutting out unnecessary spending is the key to long term financial success. Spending frivolously, or on things you don’t really need, is not smart money management. Everyone likes a blow out once in a while and make an impulse buy or two, and as long as you keep it at that, it’s fine. Good financial planning includes sorting out your personal finance goals and ensuring you spend on what you need – not on what you want.

If you ask yourself the question of whether you can live without something and the answer is yes, you don’t need it. If you don’t need it, don’t buy it. It’s really that simple. Surrounding yourself with material things doesn’t make you happy and can have a serious impact on your money goals. Check your bills and look at switching suppliers to someone cheaper. Check your grocery receipts. Are there branded items you could swap for a store brand? There are many different ways to cut your costs and all the savings mount up over time.

#6 – Pay Off Your Debt

No one enjoys being in debt but, sometimes, it’s unavoidable. If you do have debt, however, it’s essential to your long term financial goals to reduce it and repay it ASAP. Not only does this improve your credit score, but it also reduces the amount you may be paying in interest. Look at your debts and see which has the highest interest rate. If something stands out, tackle that first. Try to throw as much money to pay off your debts as you can.

Often, just making minimum payments does nothing to reduce the amount of money you owe. Minimum payments often just deal with interest, leaving you in a continual cycle of debt.  If you have substantial debt, look into consolidating them with a low-interest loan. Alternatively, look at repayments on credit cards with lower interest rates, allowing balance transfers. While interest payments might not look like much in isolation, they can soon add up to a sizeable amount of cash. Paying off your debt, therefore, should be on your list of personal finance goals for your 20s and beyond.

#7 – Establish and Maintain a Budget

One of the main facets of financial planning is goal setting. Creating a budget will give you a sound footing for managing your money. After all, you need to know where your money is coming from and going if you are going to have visibility to it and effectively manage it.

While creating a budget is a great way to start, sticking to it is the real measure of progress. There’s little point of putting a budget in place to manage your money if you then flout it at any opportunity. The key to success is to be realistic about your budget and make sure you abide by the rules you have set. It can be difficult to do at first, but you’ll soon get the hang of it. The results than can be achieved with sensible budgeting are pretty impressive.

#8 – Get Insurance Coverage

Much the same as with setting up an emergency fund, ensuring you have adequate insurance cover is essential to long term financial planning. No one wants to be caught short when something unplanned occurs. Having adequate insurance can save you a lot of unwanted stress and upset, not to mention expense, that can otherwise undo all of your careful planning and execution on your personal finance goals.

Obviously, the types of insurance you may need will differ depending on your circumstances. General policies should be taken out for renters or homeowners as appropriate, along with more specific coverage in some areas (e.g. flood, earthquake, etc.). Car owners will require insurance by law in pretty much every state. Income protection insurance is a good idea if you lose your job, and health insurance is a must, especially if you don’t enjoy it through your employer. Most companies offer various life and other insurance options, either as part of their benefits or for an extra cost out of your paycheck, but are worth exploring. Ensuring you are covered for every contingency is a critical part of setting personal finance goals that are achievable.

#9 – Buy Property

Buying property is one of the best decisions you can make in your twenties – if you can afford to do it. With a decent property, you have the potential to increase its value over time and sell it at a profit. Despite the housing bubble of the late 2000s, and the fact that property values can go down on occasion, it’s still one of the best investments you can make.

Renting property is generally a waste of funds. It merely lines the pockets of your landlord and gives you very little in return. If you can take out a mortgage and your personal finances allow you to make the payments, you are investing in your future by buying a condo, townhouse, or home – even if you end up selling it just a few years later. Buying a property also may allow you to rent out any additional rooms, offer tax benefits, and other potential for supplementary income to offset the costs. This can help to generate funds to pay your mortgage while you work towards your personal finance goals.

#10 – Start Saving

Saving money is the key to reaching your financial goals. Many people swear by putting away 10% of their paycheck each month, while others save more. Despite this, there are many people who don’t save, either because they believe they can’t afford to save, or don’t understand the importance of setting aside money for future needs. While it might not always be possible to do this, anything you can put away will benefit you in the future.

Good financial goals always, always involve saving money. The sooner you start doing it, the easier it will become, and the quicker your money will build up. You don’t even have to save with anything in particular in mind. You can merely tuck away a portion of your salary in a high-interest rate account and let it grow. Saving money is a great way to ensure you don’t end up tanking your finances later in life. This, in turn, can stop you from creating debt and make your future more secure.

What are the different types of financial goals?

The main types of financial goals are personal, short term, intermediate, and long term financial goals. Making a list of your goals and putting them into each category can help your financial planning.

Why are financial goals important?

Financial goals are important as creating a plan helps you work out what you want and how long it’s going to take you to achieve it. As the saying and its variations go, a failure to plan is planning to fail.

What is a good financial goal?

To be honest, any goal is a good financial goal, if you plan it and make it happen. The end-game will be financial independence in the long term, so this is what your overall aim should be. The best financial goals should be realistic, attainable, and measurable, allowing you to create a pathway to achieve them and monitor your progress.

What are financial targets?

Financial targets are the money goals you set for yourself. These goals will then be put into action, with a timeline attached to them. A financial target may be to get on the property ladder by the time you hit 30. Another might be to pay off the mortgage associated with the home by the time you’re 50. Everyone is different, and everyone will have goals that are individual to them.

What is the best way to achieve long term financial goals?

The best way to achieve your long term financial goals is to set up your budgets and stick to them. Sticking to plans is never easy, but being rigid about it will benefit you in the long run. Likewise, avoid spending unnecessarily, or taking on too much debt, as these are common ways in which people end up losing lots of money and missing out on their personal finance goals.


At the end of the day, everyone’s long term personal financial goals will be a little different. However, these are some pretty solid goals that you can achieve –  with a bit of planning and discipline – in your 20s. Having these achievements under your belt by the time you hit 30 will mean that you’re in great shape. It won’t be easy – no budgeting or financial planning ever is – but it will be so worth it. Visualize yourself being where you want to be and build your financial planning strategy around it. No one ever regrets being in a good financial position.  We hope we’ve given you a starting point to help you make a a plan and start on your personal financial goals to achieve in your 20s. Good luck!

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