You know how the saying goes: Bad habits are hard to break. But sometimes it’s even harder to create good habits — especially good money habits.
Roughly one in three millennials surveyed by Bank of America and USA Today said their parents did not teach them good financial habits at home. Similarly, only 19 states in the U.S. require schools to offer personal finance courses, according to the Council for Economic Education.
With rising student loan debt, millennials are struggling to put money away for retirement — or at all. The key to taking control of your finances, however, is to start young. Here are nine essential money habits you should master by your 30s.
1. Create and Stick to a Budget
Without a budget, you can’t take control of your finances. A proper budget tells you where you want your money to go — not where you’ve already spent it, said P.J. Walsh, a certified financial planner at Walsh Financial Planning.
Don’t view budgeting like balancing a checkbook by simply tracking where you spend your money. Rather, your budget should tell you how much money is going toward mandatory expenses — like rent and student loan payments — and how much you have left over to save or spend.
Free mobile apps like Mint and Mvelopes make it easy to track your income and expenses, develop a budget, and stick to it. But while setting up a Mint account might be easy, keeping tabs on your budget and making adjustments to it every month takes discipline. “A budget is not a ‘set it and forget it’ process,” Walsh said.
2. Live Below Your Means
More than 20 percent of millennials spend more than they earn, according to the FINRA Investor Education Foundation. Even if you’re scraping by paycheck to paycheck, you’re still falling behind on retirement savings. To truly get ahead financially, you have to live below your means so you can build wealth and reach savings goals.
To live below your means, you’ll need to make sacrifices — like skimping out on daily Starbucks runs and cutting down on weekend drinking. Reconsider where you eat and how much you’re spending each meal. Small purchases can add up.
Say, for instance, you work a typical 40-hour work week and eat out at lunch with coworkers everyday. If you’re spending $7 per meal, in one month you’ll have spent $140. Over the course of a calendar year, you’ll have spent $1,680 — and that amount doesn’t include the cost of breakfast, dinner and weekend brunches.
3. Manage Credit Wisely
Overall, millennials aren’t doing a good job of managing credit wisely. They’re more likely than other generations to be engaged in costly credit card behaviors — like carrying a balance, making minimum monthly payments and paying late fees — according to the FINRA Investor Education Foundation.
But why are these behaviors so costly? If you’re maxing out credit cards and paying bills late, you’re hurting your credit score. And a bad score can affect your ability to get more credit and forces you to pay higher interest rates.
You can boost your credit score and improve your credit history by keeping balances low and avoid opening too many credit accounts at once. If you need to use your credit card to afford a purchase, chances are you shouldn’t be making the purchase.
You should also periodically check in on your credit report. You can get a free credit report from AnnualCreditReport.com. Be sure to report any errors that might be weighing down your score.
4. Build an Emergency Fund
Only 33 percent of millennials have an emergency fund, according to the FINRA Investor Education Foundation. When you’ve only recently graduated or started working full time, finding room in your budget for a rainy day fund might seem impossible. But Walsh said contributing to an emergency fund should be treated as a mandatory expense — not a luxury.
Without an emergency fund, you’ll likely have to rely on credit cards to cover a car repair, a trip to the emergency room and other unexpected expenses. If money is tight, start saving in small ways.
Set up small, automatic deposits from your checking to your savings account. Even saving $25 every two weeks can save you $650 over the course of a year. If you receive a bonus, immediately put a portion of that money into savings. If you made plans for brunch but cancelled last minute, transfer the money you would have spent into your savings — after all, if you could afford brunch, you can afford to put the money away.
5. Save for Retirement
29 percent of millennials said they are actively saving for retirement, according to Bank of America and USA Today. While saving for retirement might not seem like a priority in the face of student loans, the sooner you start saving for retirement, the more quickly you can build up savings — that’s the power of compound interest.
“Taking advantage of compound interest as soon as you can can give you tens of thousands to hundreds of thousands more in retirement,” said Erin Lowry of Broke Millennial. If, for example, you contribute $100 every month in a retirement account and earn 8 percent back on your investment year over year, you’ll have more than $135,000 in savings in 30 years. Delay your savings by ten years, however, and you’ll have just over $55,000.
6. Set Financial Goals
Less than half of millennials surveyed by Bank of America and USA Today said they have savings goals. Without knowing what your future financial plans are, saving money — and saving enough — can be difficult.
Although long-term goals are important, Lowry recommended setting shorter-term goals to help you save for purchases you’ll need to make sooner rather than later. Having money saved for Christmas gifts, for instance, can help you establish a hard budget come winter. Having a savings plan for a car down payment will also reduce the size of your auto loan, if you need one at all.
7. Pay Bills on Time
Millennials aren’t the only ones struggling with their finances. More than one-third of consumers paid late bills in 2014, according to a survey conducted by Fiserv, a provider of financial services technology. Not only can paying bills late hurt your credit score, they can lead to hefty fees — which will leave you with less money to pay other bills.
If you’re having trouble remembering to pay bills, set up automatic payments through your bank and service providers. You also can use apps like Mint Bills to receive alerts when bills are due to avoid late fees.
8. Learn to Do-It-Yourself
One way to spend less every month is to learn how to cook, clean and make repairs by yourself. Lowry recommended avoiding restaurant expenses by cooking meals at home. She cooks large quantities of food on the weekends so she can enjoy packed lunches during the week.
Lowry also does her own nails and has taught herself how to make simple repairs around her apartment. With instructional videos on YouTube, paying a plumber to have your sink unclogged, for instance, might not be worth the expense.
9. Stop Relying on Parents for Financial Support
About half of millennials have received financial assistance from their parents after moving out, according to a study conducted by Fidelity. If you have a job but are still relying on your parents to pay for groceries or your cell phone bill, you might need to take initiative and cut the cord. Adult children who continue to rely on their parents as a source of income won’t learn to become financially independent, said David Bader, a certified financial planner (CFP) and regional director at Merrill Edge.
Depending on your parents could be hurting their financial futures, too. Saving for retirement, after all, doesn’t stop once you’ve hit your 30s.