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1. Budget wisely

First rule of thumb: Don’t drive through half your earnings for a new set of wheels. Affleck and Damon would have benefited from making modest purchases instead of splurging on a pair of Jeep Cherokees and a party house.

Make a budget — and more importantly — stick to it. Keep track of your monthly spending, whether that’s with pencil and paper, an Excel spreadsheet or through an app.

First start off with your necessities, like groceries and rent, then set some cash aside for your debts and savings. Once you’ve got the basics covered, you can consider treating yourself afterwards.

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2. Pay off any debts

After you create a budget, take care of the bills — whether they’re from your film agent or your credit card company.

Remember that credit card interest adds up over time, so it’s important to pay your monthly bill in full and on time each month. If you’ve got a stack of bills coming in, consider starting off by clearing your highest-interest loans first.

If you’re struggling to keep track of what you owe to who, you might consider rolling all your debts into a single loan with a lower interest rate, so that can save yourself some interest and only have to worry about one bill each month.

3. Build an emergency fund

Even if you do end up going broke in six months, it’s helpful to have an emergency fund in place to provide some buffer until your next paycheck.

Most experts recommend having at least three to six months’ worth of savings set aside at all times to prepare for unexpected crises, like a big medical bill or a job loss.

Consider setting some cash aside into a high-yield savings account that comes with higher interest rates so you can grow your savings as well.

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4. Save for retirement

When you’re young, your vision for retirement might still be a little hazy, but investing early is always better.

Do your research and pick out some safe, stable investments to start out with. If you’re not comfortable managing your portfolio on your own, consider trying out a robo adviser that’ll automate things for you.

Even if you can’t afford to set aside thousands of dollars for investment purposes, you can get started with just your spare change. And thanks to compound interest, those cents will add up to dollars over time.

5. Earn some passive income

Finally, instead of depleting your earnings, find simple ways to boost them on the side. Investing, especially on stocks with high-dividend yields, has long been a popular method of supplementing income.

But many people are put off by the risk involved in investing in the stock market before you can reap any rewards.

One lucrative alternative is real estate. In fact, prime commercial real estate has outperformed the S&P 500 over a 25-year period.

And now, thanks to new crowdfunding investing platforms, investors of all types can own a percentage of physical real estate — from rental properties to commercial buildings to parcels of land — with as little as $100 to invest.

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About the Author

Serah Louis

Serah Louis

Reporter

Serah Louis is a reporter with Moneywise.com. She enjoys tackling topical personal finance issues for young people and women and covering the latest in financial news.

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The content provided on Moneywise is information to help users become financially literate. It is neither tax nor legal advice, is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Tax, investment and all other decisions should be made, as appropriate, only with guidance from a qualified professional. We make no representation or warranty of any kind, either express or implied, with respect to the data provided, the timeliness thereof, the results to be obtained by the use thereof or any other matter.