Stepping out of your parents' comfort bubble can help you become independent, especially in terms of finances. You will have financial woes that you need to work on if you want to achieve your financial goals.

Before you reach your 20s, you often are able to use up all your allowance for unnecessary things and not care because you are, after all, young. You still think you aren't making reckless decisions and purchases. Now that you’re done with college and have started working, though, it’s time to pick up the pieces and start saving more for your future.


If you are in your 20s and still reckless, financial-wise, you need to check on your habits. Here are the three uncomfortable financial woes you can experience in your prime years. Make sure that you handle these woes properly to avoid even bigger mishaps.

Financial Woes in your 20s

Unsettled Student Loan

Right after college, the one thing that you need to think about is the student loan debt that will arrive six months after graduation. In the United States, the average student loan debt per student is $29,800, and if you don't pay in full each month or never at all, your balances will grow because of interest.


There are people with financial woes who do this and don't pay for their student loans year after year, only to find out that their loan has been on delinquent status, or worse - default. Not paying for 90 days after a payment deadline can lead to a defaulted loan, which can affect your credit rating. If this happens, you can have a hard time applying for other loans such as a mortgage, car financing, and other financial services. Hence, it’s better to stay up-to-date when it comes to your student loan payments.

You can check sites that offer student loan refinancing. They will help reset your previous loan to a longer term but with lower monthly payments to fit your budget. This will help you pay off your debt and most importantly, it won't affect your credit score.

Credit Card Debt

Incurring debt on your credit cards is a trap that can affect your finances for years. Depending on the balance and interest, the amount can reach thousands of dollars. Imagine, if you are just starting a job and your salary isn’t that big, the monthly repayments can ruin your budget.


To prevent credit card debt, it’s important to borrow the amount of money you know you can afford to pay back in full. Prevent impulsive buying, and as much as you can, don’t fall for installment packages when it comes to a big purchase. Save up for the things you want and use the card only for daily expenses like groceries, eating out, and gas. And if you think you don't need it and can survive with a cash basis payment, know how to cancel a credit card so you won't be tempted to use it and ruin your budget planning.

Lack of Savings

The amount you should be saving depends on your retirement goals. If you want to enjoy a carefree and laid back retirement, you definitely need to save more from your monthly salary. The rule of thumb is to set aside the 15 percent of your pre-tax income to your retirement savings. Try to stick to a budget that works for your lifestyle and save as much money as you can.

You should start saving while you are young. This way, you can enjoy your retirement without having to worry about where to get money for your monthly expenses and in case of medical emergencies.


These are just the three financial woes that can hit you in your prime years. Remember that there is always a way to fix these things so you can enjoy life in your retirement.