By Eric Reich

Financial literacy is key to achieving financial freedom. The earlier you start managing your money wisely, the better. By building strong financial habits, staying disciplined, and setting clear goals, you can take control of your financial future.

1. Start budgeting early: Understanding your cash flow is essential. Use a simple app or spreadsheet to track income and expenses. A common budgeting strategy is the 50/30/20 rule, where:

50% of income covers necessities (rent, utilities)

30% goes to discretionary spending (entertainment, dining)

20% is allocated to savings or debt repayment

2. Build an emergency fund: Having three to six months’ worth of living expenses in savings can prevent financial hardship during emergencies like medical bills or car repairs. It’s always easier to stay ahead than to recover from financial setbacks.

3. Avoid high-interest debt: Credit cards and payday loans can lead to financial trouble if not managed properly. Aim to pay off balances in full each month, avoid unnecessary borrowing, and develop a structured repayment plan for student loans and other debts.

4. Building credit wisely: A credit score determines your ability to secure loans and favorable interest rates. Improve your score by paying bills on time, keeping credit utilization below 30%, and regularly checking your credit report for errors.

5. Start saving and investing early: Time is your greatest financial asset. Compound interest allows your investments to grow exponentially. Consider:

Low-cost index funds and ETFs for stock market exposure

Contributing to employer-sponsored retirement plans, such as a 401(k), to maximize matching contributions

6. Live below your means: Resist lifestyle inflation — just because you can afford something doesn’t mean you should buy it. Wealth is built by prioritizing saving and investing over unnecessary spending.

7. Educate yourself about money: Financial education is a lifelong journey. Books like “The Psychology of Money” by Morgan Housel and “Rich Dad Poor Dad” by Robert Kiyosaki provide valuable insights into wealth-building.

8. Set clear financial goals: Whether it’s buying a home, funding a vacation, or retiring early, well-defined financial goals help you stay motivated. Break long-term objectives into manageable steps to maintain focus.

9. Stay patient and consistent: Wealth-building is a long-term commitment. Avoid get-rich-quick schemes and focus on steady saving and investing. Even financial mistakes can be overcome with persistence.

10. Take advantage of employer benefits: Maximize your 401(k) match, health savings accounts (HSAs), and other employer-sponsored financial perks. These benefits offer a valuable opportunity to grow wealth.

11. Avoid financial FOMO: Social media often creates a false sense of financial urgency. Stay focused on your personal financial plan rather than keeping up with others’ lifestyles.

12. Strong wealth leads to strong health: Financial stability improves access to healthcare, better nutrition, and mental well-being. A well-managed financial life leads to an overall better quality of life.

By following these principles — budgeting wisely, saving diligently, investing early, and living below your means — you can secure financial freedom and build a bright future. The key is consistency, patience, and education. Register for our upcoming Financial Literacy Seminar for Young Adults on April 24. Visit www.reichassetmanagement.com/events for more information.

Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Reich Asset Management, LLC is not affiliated with Kestra IS or Kestra AS. The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra Investment Services, LLC or Kestra Advisory Services, LLC. This is for general information only and is not intended to provide specific investment advice or recommendations for any individual. It is suggested that you consult your financial professional, attorney, or tax advisor with regard to your individual situation. To view form CRS visit https://bit.ly/KF-Disclosures.

Eric is President and founder of Reich Asset Management, LLC. He relies on his 25 years of experience to help clients have an enjoyable retirement.  He is a Certified Financial Planner™ and Certified Investment Management AnalystSM (CIMA®) and has earned his Chartered Life Underwriter® (CLU®) and Chartered Financial Consultant® (ChFC®) designations.