Starting From Zero: A Real Budgeting Plan for Your 20s That Doesn’t Assume You Already Have Money

If you’re starting from zero financially, focus on spending awareness, a small safety net, and automatic saving.

Start by tracking spending, building a small emergency fund, and automating savings. LittlePigPower/Shutterstock

If you’re in your 20s with no savings, some debt, and a budget that feels like it has no room to breathe, the standard personal finance advice wasn’t written for you. Instead, consider this plan.

Start by tracking your actual spending for 30 days, build a starter emergency fund of $500 to $1,000, then set up one automatic transfer to begin growing your money—in that order. Everything else comes later.

The Details: How to Start Budgeting From Scratch

The financial pressure on today’s 20-year-olds is structurally different from a generation ago. For example:

• Student loan balances are larger.
• Rent consumes a higher share of take-home pay than at any point in recent history.
• Entry-level salaries have not kept pace with the cost of living in most major metropolitan areas.

Even at its current moderated levels, inflation has permanently raised the price of groceries, utilities, and transportation.