money-saving secrets for young adults

Posted : July 28, 2014
Last Updated : July 1, 2022

money-saving secrets for young adults

Saving money is a good habit to develop as a young adult. Whether you're currently in college or you'll be headed to college soon, learning how to save your money is one of the most important steps you can take in order to be financially stable throughout your life.

During your high school and college years, use these money-saving secrets to stay on the path toward financial stability.

Set saving goals.

Saving money in high school and college is an essential financial practice, and setting goals is a terrific way to stay motivated.

By setting short-term and long-term goals, you’ll be inspired to keep track of your savings and more likely to spend your money wisely. For instance, if you have a goal to save $5,000 for a used car, you’ll feel more motivated to put money into your savings account, rather than spending it on other things. 

Ultimately, you’ll be able to enjoy the results of your hard work and build skills that will serve you well for the rest of your life. 


Deposit gift money into savings.

Anytime you receive gift money, such as birthday or graduation cash, deposit it into your savings account. Since this is money that you wouldn’t normally count on as part of a regular allowance or paycheck, you know you can get by without it. So instead of spending it right away, put the money in a high-yield savings account and let it accrue interest.

Try to save half of your income.

As a young adult, you may have a part-time job, but probably don’t have many bills to pay. Now is the perfect time to focus on maintaining a high savings rate, which means bringing in more money than you spend.
To calculate the percentage of money you’re saving, divide your total monthly savings by your gross monthly income, then multiply the final number by 100. That equation will tell you your savings rate, which is the percentage of money you’re putting into savings each month. 
As a student, saving half of your income is a fantastic goal. Once you graduate and your income grows, you can continue to monitor your budget and spending to maintain a strong savings rate.


Plan ahead.

From flat tires to medical bills, you'll doubtlessly encounter unexpected expenses throughout college. Learning how to plan ahead for unexpected expenses will help you avoid going into debt.

Begin building up an emergency fund in case of these types of costs. An emergency fund is a portion of your savings, or a separate savings account, that you don't touch except in the case of an unavoidable, necessity expense.

If you aren't sure where to start, working toward an emergency fund of $1,000 is a terrific first goal. From there, you can continue building on your emergency savings, as well as save toward other long-term purchases.

Don't try to keep up with everyone else.

If your friends always seem to buy the latest gaming system or designer clothing, you may be tempted to spend your money on similar items. However, keeping up with others can seem like a never-ending battle, as someone always has something newer, faster, and shinier than you.

Instead of keeping up with the Joneses, focus on saving toward your goal purchases, whether that's a semester of tuition, a car, a vacation or something else on your "to-buy" list. At the end of the day, you'll be glad you focused on what was meaningful to you, rather than spending unnecessary money simply to keep up with your friends.

Avoid spending money as a hobby.

This saving secret will be hard for you if shopping is something you really enjoy doing. But keep in mind that stores and shopping malls are designed with one objective – to make you spend money. Instead of heading straight to the store the next time you want to go out, instead try an alternative like taking a walk at the park or checking out a campus event.

Dining out is another common pitfall for high school and college students. While a fun, and often seemingly inexpensive, social pastime, if you go out for lunch or dinner every time you get together with friends, you may notice your savings starting to dwindle. 

To be financially savvy, you should find other ways to spend your leisure time, such as free concerts, sporting events, and art museums.

Reduce monthly expenses.

Revamp your spending habits and deposit that extra money into your savings account. Here are a few ways to reduce your monthly expenses:

  • Limit vending machine purchases
  • Pack your lunch for school
  • Reduce drive-thru visits
  • Go to a matinee movie instead of an evening show
  • Check out books and magazines from the library instead of buying them
  • Avoid cell phone data overages by limiting your usage or upgrading your data plan

Finding a few easy ways to cut back on spending can add up to major savings in the long run.

Don't count on credit.

Credit cards can be a great tool for handling unexpected expenses and to build a good credit rating (if used correctly). However, you should avoid using your credit card for everyday purchases or to pay for an item or event that you really can't afford. Using your credit card for frivolous purchases will only cost you more money in the long run.

For more ideas on saving money during school, check out the articles in the College Budgets 101 section of this website.

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