The ’20s are one of the most crucial decades of one’s life. This is the time when one gets into one’s first job, becomes financially independent and the world seems rife with possibilities.

This time also brings one face-to-face with responsibilities. Starting from living on one’s own, making one’s own decisions to paying one’s own bills. However, experts say, while one enjoys this newfound freedom, it becomes essential that one takes some time to start planning one’s personal finances.

Nityanand Sharma, Co-Founder and CEO Simpl says, “Developing the right acumen to manage your finances at this phase is critical.” He further adds, “One of the most important lessons at any age is budgeting – having an understanding of your income and expense and making decisions accordingly.” Having proper budgeting and planning finances will ensure that you don’t fall into any debt trap or overshoot your spending. Hence, the practice of budgeting will keep your finances good and steady in the longer run.

At the same time, it is equally important to be mindful of your money. Sharma of Simpl, says “At this age, it is critical for one to understand that they won’t be earning forever. Hence, one should inculcate the habit of investing as soon as one starts earning.”

Note that retirement may seem far away but it definitely helps if you start early. A difference of just 5 years could cost you a lot. Experts suggest, besides investing, one should also have an emergency fund. Creating provision for a rainy day may seem unnecessary but its importance can’t be stressed enough.

Sharma of Simpl, says “As you start your first job, get acquainted with the concept of credit. Sooner or later you will have to come face to face with credit.” While opting for credit of any kind, be aware of the pros and cons of the different forms of credit. Additionally, when the time comes, pick the one that is best suited to your profile.

While it is good to have a check on your spending behavior, don’t forget to indulge and reward yourself once in a while. Sharma of Simpl, says “Being wise with money shouldn’t be seen as a punishment but rather as a guilt-free way to make the most of your hard-earned money.” He adds, “And as you progress in life, your needs and spending habits will also require a revision. Therefore, be sure to revisit and reorganize your budget to make room for new avenues of spending and investing.”

Having said that, remember to set realistic goals and then go about achieving them by sticking to your budget.