The reality of paying your own way often gets lost in the excitement to live on your own, but you should remember these financial truths.
Are you leaving the nest? Are you packing your things with a head full of dreams about how great it will be to live on your own or with friends, away from the supervision of your parents? Before you run out the door, read these harsh truths to keep in mind while you live your life of independence.
Ask any adult what it was like entering the working world or moving into their own place and they will tell you that leaving the nest was a big financial wake-up call for them, Ruhan van Zuydam, wealth management specialist at Consult by Momentum, says.
“Not only was life vastly more expensive when no longer cushioned by the comfort and safety of your parents, but you were also forced to face the realities of adulthood such as bills, rent, groceries – and what they reallycost.”
Nine times out of 10, they will also tell you that they wished someone had been honest with them about what to expect.
“Leaving school or university and joining the workforce marks an exciting but often uncertain new chapter. Many young people step into adulthood with big dreams, but little guidance on what to expect or how to build and protect their financial dreams.
“Therefore, it is important that young people understand the harsh realities of adulthood so that they can kick off their financial futures on the right note.”
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Van Zuydam shares these five hard truths about leaving the nest to keep in mind:
1: It costs more to live than you might think
The jump from student life to adulting often comes with a price shock. Rent, groceries, transportation, Wi-Fi, and unexpected expenses pile up quickly.
“Taking responsibility for your expenses can be overwhelming, but it is also a motivator to start budgeting, planning, creating a rainy-day fund and taking ownership of your financial future.”
2: No one is going to advocate for you to get that career opportunity
In school or university, someone may have guided you or recognised your potential. “In the real world, success is not handed out but earned.
“You must speak up, ask for feedback, build networks and actively position yourself for growth. Financial independence and opportunity do not come to those who wait, but rather to those who seek them.”
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3: The earlier you get on the books, the easier your life will be
Building a credit and insurance record early sets the stage for future financial ease, Van Zuydam says.
“A solid credit history helps with everything from renting a flat to qualifying for a home loan, while some forms of insurance, such as life insurance, are often cheaper when you are younger, as you are seen as lower risk.“
Start small and let time work in your favour, is his advice.
4: But also, be warned: living on credit will cost you
Van Zuydam warns that you must never think that credit is free money.
“It is a future obligation. Living beyond your means on credit cards or loans can quickly spiral into unmanageable debt. Avoid unnecessary debt and prioritise needs over wants. If you must borrow, do so with a plan to repay in full and as quickly as possible.”
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5: Most South Africans will not have enough money saved to retire comfortably
Do not be one of them. “Retirement may feel like a distant concern, but starting early is key. Thanks to compound interest, even small amounts saved from your first pay cheque can grow into a substantial nest egg.
“Wealth creation does not happen overnight. It takes time, discipline and commitment and the earlier you start, the better.”
