Financial Advice For Young Adults

  • FitBUX
  • |
  • Financial Advice For Young Adults
Author: Joseph Reinke, CFA

I spoke at a healthcare conference in Washington D.C. about student loan debt a few years ago. While there, I listened to a few other presenters.  One of them made the following statement, “80% of healthcare outcomes are driven by behavior.”  I smiled when I heard that. In my opinion behavior accounts for 80% of outcomes for everything.  This is why when I’m asked about financial advice for young adults, my advice focuses on behavior.  I, then, focus the discussion on how to develop healthy financial habits.

This article summarizes financial advice for young adults and developing those healthy financial habits. Specifically, the advice I provide discusses 3 actions young adults can take to develop healthy financial habits.  If you begin implementing this financial advice, you’ll increase your odds of success.  In case you’re wondering how I came up with these, I follow them myself.

40 Days and 40 Nights

Most of us raised in the United States have a consumption mentality.  This is true of young adults and older individuals.  This is an extremely hard mentality to break for multiple reasons such as peer and social pressure.  A big issue is that traditional financial advice for young professionals is horrible and it makes me cringe.

“You have to budget and be disciplined!” is what the ‘financial gurus’ scream from their multi-million dollar soap boxes.  This leads young adults to say and do things like, “I’m going to stop all reckless spending. I’m going to make a budget and follow it.”

This makes me cringe because I know for the majority of young adults, it’s not going to work.  This is why most that make a budget that they don’t follow for more than 3 – 6 months.  According to CNBC, 74% of consumers have a budget.  However, only 21% actually follow it.

The reason young adults fail is that this type of budgeting makes people miserable.  In short, it doesn’t inspire a behavioral change.  Therefore, my financial advice for young adults is based on a strategy that I call “40 days and 40 nights”.

The cool thing is you can also use it for other personal wellness benefits such as health.  I’ve not only seen others implement this with amazing success, I do it myself!

How it works

The key to this piece of financial advice is to not cut all your expenses at once. Instead, you build a budget and do everything exactly the same.  That’s right…keep over spending on things you probably don’t need!

Then, pick only one thing and cut it out of your life for 40 days.  After those 40 days you’ll learn that you probably didn’t need that thing you eliminated to begin with.  Then pick a second item and repeat.  Within a year you can cut 8 – 10 things.  Plus it will get easier and easier because your consumption mindset starts to change.

One other secret. The item you cut might not even have to do with money…but it leads to better money habits and financial savings.  Below are two examples.

Example 1

When I was young, sports was my life.  Even after my playing days were over, I kept watching sports.  One day about 14 years ago I got sick of watching sports because half the time was watching commercials.

Therefore, I told myself that for 40 days I wouldn’t watch anything live. Instead I’d TEVO’d it (TEVO used to be a system to record shows then watch them later).  By doing so, I would be able to fast forward through commercials.

I didn’t last 40 day…..

Since I wasn’t watching sports live, I had a lot of time on my hands.  I began reading more, learning more, investing more, etc.  Within about 20 days I unconsciously stopped watching sports completely!  This had nothing to do with money but it changed my consumption lifestyle, i.e. I was consuming sports with my time.

Afterwards is where the money savings came into play.  The only thing I watched on TV was sports. Therefore, if I wasn’t watching sports anymore, what did I need TV for? Since then, I haven’t watched TV.  This has saved money on new TVs, cable, satellite, streaming services, etc…

Thus, one place you can potentially start is cutting out one show you think you “need to watch” for 40 days.  This is way better than saying, “I’m going to cut watching all TV at once just so I can save on cable/streaming bills.”

Example 2

At one point I was drinking at least 5 caffeine drinks a day (Rockstars, Red Bulls, coffee, etc.)  It would’ve been very hard for me to stop drinking them simply for a financial reason.  Instead I said I was going to stop drinking caffeine for health reasons.

The 40 days came and went. I haven’t drank caffeine for 3 years.  In fact, I felt so good health wise that I then did the same thing for alcohol and any drinks with sugar.  I have literally drank nothing but water for the past 3 years.  Not only do I feel awesome every day, think of all the money I save by not consuming items that are poisoning my body… a win win situation.

Have A Plan But Focus On The Short-Term

Most young adults build a financial plan for the long-term which is an absolute must.  In fact, we recommend using our 5 step approach to building a plan because building a plan correctly is really important.

However, most build their plan wrong because they don’t set up their goals correctly.

Their goals are so far into the future that they stop following the plan before they hit them. It is like how you would break down your patient’s long-term goal into smaller short-term goals.

Research shows that the farther away a goal is the less likely we are going to continue to pursue it.  Therefore, the proper financial advice is to set your long-term goals but focus on short-term milestones.

Unfortunately, for most young adults, achievements such as paying off debt, saving for retirement, etc… are years away.  Therefore, young adults feel like they achieve anything in the short-run.  This often leads to a defeated feeling.

One suggestion is to break long-term milestones into short-term goals.  You do so by say something like, “Within three months I’m going to have my debt balance down to $x amount.”  Therefore, you don’t have to pay off the whole thing to achieve a goal.

Again, I want to reiterate this financial advice for young adults. You absolutely must build a plan and simulate what it will look like in the long-run. However, your immediate focus should be achieving short-term milestones.


The last piece of financial advice for young adults is: Focus. We actually saw an example of this advice above under my 40 days and 40 nights habit.

The most we can focus on at a time is 2 – 3 things.  That is why if you try to cut multiple items out of your life simply to follow a budget, you will most likely fail.  You aren’t focused on one thing.

Same with other financial goals.  Most of the time at FitBUX, we see young adults wanting to pay off credit cards, pay off car loans, pay off mortgages, pay off student loans, save in their 401k, save in an IRA, save for a vacation, fund a child’s education, and they want to do it ALL at the same time.

That is how most young adults set up a financial plan and it fails.  My advice is to focus on 2 maybe 3 things at a time and that is it.  You might say something like, 1) I’m aggressively paying off my student loans, 2) getting my retirement match in my 401k, and 3) saving $100 a month in a ROTH IRA.  Those are your three things and that is it.  Then after your student loans are paid off, go to the next thing such as a car loan…. DON’T TRY TO DO EVERYTHING AT ONCE.

Again, I do this in my personal life so I know it works and I don’t just mean financially.  People ask how I get so much done.  My whole life is focused on 2 things: My Family and FitBUX.  If something doesn’t fall within those two things, I don’t do them, period.

And yes, I know this is hard to do.  For example, my background is investing.  I have not invested or researched any individual stocks or investments since starting FitBUX. I completely cut that out of my life. Why? Because it takes time away from my family and FitBUX. Plus, FitBUX is my investment so why worry about any other investments? Doesn’t make since right…


My financial advice for young adults centers around developing healthy financial habits.  To help you do so, my advice is:

  1. Cutting one expense at a time and do so for 40 days
  2. Have a plan but stick to short-term goals
  3. Focus

By Joseph Reinke, CFA

Joseph Reinke, CFA

Follow me here

About the Author

Joseph Reinke is a Chartered Financial Analyst (CFA) Charter Holder and founder of FitBUX which has helped over 14,000 young professionals on their journey to financial freedom. Joseph has been personally investing since he was 12 years old.

In addition, he has experience in student loans, mortgages, wealth management, investment banking, valuation, stock trading, and option trading. He has been on 100s of podcast and has been invited to 100s of universities to discuss financial planning with their soon to be graduates.

{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}