Finance Basics Everyone Should Know: A Guide for Every Age

Money Basics for Kids & Teens

Key Focus: Learning to Save and Budget

It’s never too early to develop good financial habits. Teaching kids and teens about money management sets the foundation for a lifetime of financial confidence.

• Saving vs. Spending: Encourage kids to divide their allowance or gift money into “save, spend, and give” categories. This helps them understand priorities and delayed gratification.
• Opening a Bank Account: A savings account is a great way to introduce banking. AbbyBank’s junior savings accounts make it easy for kids to start saving. For older kids or teens, AbbyBank’s Bright Future Checking account is a great next step. It’s designed to help them learn how to manage a checking account responsibly with tools that support financial independence.
• Budgeting Basics: Teens with part-time jobs should track their income and expenses to understand how to manage money effectively.
• Understanding Credit: Teaching teens about credit scores and responsible borrowing can prevent financial missteps in adulthood. A secured credit card or authorized user status on a parent’s card can help them build credit responsibly.

Ready to open a bank account for your child?  Reach out to us today—we’re here to help you open the right account for your child’s age and financial goals.

FINANCE 101 FOR YOUNG ADULTS

(20s-30s)

Key Focus: Building a Strong Financial Foundation

As young adults step into the workforce and take on financial responsibilities, it’s important to make informed decisions early on.

• Creating a Budget That Works: A simple 50/30/20 budget (50% for needs, 30% for wants, and 20% for savings/debt payments) can help keep spending in check.
• Establishing an Emergency Fund: Aim for at least three to six months’ worth of expenses in an easily-accessible savings account.
• Building Credit Wisely: Pay bills on time, avoid maxing out credit cards, and only borrow what you can repay. Ready for a credit card that works for you? Check out our options at AbbyBank.
• Saving for Retirement Early: The earlier you start, the better! Contributing to a 401(k) or an IRA in your 20s means taking advantage of compound interest. Even small contributions add up over time.

Money Matters for Mid-Life

(40s-50s)

Key Focus: Growing Wealth and Protecting Assets

At this stage, financial planning becomes more about growing investments and ensuring a stable future.

• Maximizing Retirement Contributions: If you haven’t been maxing out your 401(k) or IRA, now is the time to do so. Take advantage of employer matches and catch-up contributions.
• Paying Down Debt: Focus on eliminating high-interest debt like credit cards and consider accelerating mortgage payments, if feasible. Maximize cash back and earn rewards with AbbyBank’s selection of credit cards.
• Investing Wisely: Diversifying your investment portfolio can help balance risk and reward. Work with a financial advisor to ensure you’re on track.
• College Planning for Kids: If you have children, explore 529 savings plans and other education savings options.
• Protecting Your Wealth: This is a great time to review insurance policies and create or update an estate plan.