Smart Saving Tips To Practise in Your 20s
June 18, 2024
Photo by Karolina Kaboompics on Pexels

Stepping into your 20s might feel like a mix of exciting possibilities and confusion. You’re learning about yourself, making big decisions, and dealing with money matters too. 

The truth is most young adults find it challenging to save and build their wealth. So, you’re not alone. However, with strategic planning and smart decisions, you can steer clear of potential financial pitfalls in the future. 

In this article, we'll talk about five saving habits and one bonus tip you can practise in your 20s that will make a significant impact on your financial future. 

1. Build a Savings Mindset 

Developing a savings mindset means shifting away from the 'spend now, think later' approach and looking at saving as an investment in your future well-being.

One way to get into the habit of saving is to have a clear goal to work towards1, such as saving S$6000 for your wedding.

Then, view your savings as a regular monthly expense. Set aside a fixed portion of your income before spending on anything else. 

You can also track your weekly income and expenses to help you stay on top of your saving goals.

A saving mindset will take time to develop but it will no doubt lead to a more secure financial future. 

2. Budget Smarter with Technology

Budgeting is like having a roadmap for your money. It helps you see how much you're earning, where your money is going, and how much you can save. 

However, most of us tend to struggle with budgeting because keeping track of our expenses with old-school spreadsheets can be a headache. 

But budgeting apps, like Household Account Book, Spendee, Wally, and Dobin 2, have made tracking expenses easier.

Budgeting apps categorise spending, helping you identify areas where you can potentially save money. They also allow you to set realistic budgets for different expense categories, making it simpler to manage your finances effectively. 

Whether it's groceries, entertainment, or utilities, you can use budgeting apps to help you stay on track with your financial goals.

3. Automate Savings and Payments

Setting up automatic payments can be a real lifesaver, especially if you have many bills due each month. It saves you time and keeps you from stressing about remembering different due dates.

Consider automating payments for loans, bills, and regular expenses through your bank. With automation, you could tackle high-interest debts first, which will significantly reduce your overall interest charges. 

Additionally, you can run your savings on autopilot by scheduling automatic transfers. This way, you're consistently and effortlessly building your savings. 

However, it's important to always review your automatic payments regularly. Cancel outdated subscriptions or services that you no longer use to free up more cash.

4. Negotiate Your Loan Terms or Bills

Think about it this way: if you can handle hearing a "no", there's no harm in asking for a discount. You might not realise it, but many bills can be negotiated.

Negotiating your bills can significantly impact your finances, helping you keep more money in your pocket. Start by negotiating interest rates on loans, especially home loans, as banks might have better rates to offer. 

Additionally, do not hesitate to reach out to your service providers to discuss potential discounts. Landlords and utility companies may also be open to negotiation, which can result in significant savings that add up over the months and years.

Remember, every dollar saved is a dollar you get to keep. 

5. Take Advantage of Tax Benefits

To maximise your tax benefits and save more in your 20s, understand what tax breaks are available to you. Find out tax deductions or credits that apply to you, such as educational expenses or life insurance reliefs. 

You can put as much as you can into tax-friendly accounts like the Supplementary Retirement Scheme (SRS) or Central Provident Fund (CPF). Saving into tax-friendly accounts can lower your taxable income or make sure your interest is tax-free3. This way, you’re not only paying lower tax but also building a solid financial base for your future. 

With some careful planning, you can make the most out of your income.

6. Bonus Tip - Invest Wisely

In your 20s, your age is your edge when it comes to building wealth through investments.

Because starting early means your money has more time to grow and work for you. 

However, it's important not to jump into the market without a well-thought-out plan.

There are different investment options available locally, such as mutual funds or ETFs (exchange-traded funds). You can also take advantage of the various CPF investment schemes, which offer several ways to diversify your money that would fit different risk tolerances. However, it’s always important to consider your financial goals, capacity, and risk tolerance before investing.

Check out this introduction to investing and learn how to optimise your CPF savings for more tips.

Final Thoughts

When you're in your 20s, the financial landscape can seem daunting. But it's also filled with opportunities for smart financial moves.

We hope that with these tips, you will be able to make good money choices, build a strong financial foundation, and reach your money goals.

Remember, every dollar saved and invested today is an investment in your future. With a little discipline, these habits will pay off well into your 30s and beyond.

We hope this article helped you in your wealth accumulation journey. Share this with a friend who might need it too.

👋 Need additional advice and support on navigating your financial planning? Book a complimentary consultation with us.


  1. 15 Ways to Build a Growth Mindset | Psychology Today
  2. 9 Free Budgeting Apps to Help You Manage Your Expenses (2024) | Money Smart
  3. Supplementary Retirement Scheme | MOF

The views expressed in this media do not necessarily reflect the views of PFPFA Pte Ltd (“PFPFA”). The information provided herein is intended for general circulation and not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use will be contrary to local laws or regulation. You should also note that the information presented does not have regard to the specific investment objectives, financial situation or the particular needs of any specific individuals; and therefore, may not be appropriate to your individual needs. You should seek the advice of your financial adviser representative or a professional before making any commitment to purchase or invest in any investment product. 

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