They say hindsight is 20/20, and if you’re older than 30 you’ve probably wished that someone had shared this advice with you when you were starting out on your work journey.

But for millennials, it’s not too late to get ahead of managing your money early to set you up for financial freedom later on in life.

As Carlo Gil, financial advisor at Liberty says, your future isn’t as far off as you may think when you’re in your 20s, so the earlier you start taking charge of your finances the better off you will invariably be.

“In my line of work, we talk a lot about being financially savvy,” he says. “It really isn’t that easy, especially as a young person coming into money after many years of being taken care of by your parents. However, it’s essential to start thinking about your financial future at the start of your career – your future isn’t that far off.”

  1. Learn to budget

No money management tool or financial plan can work effectively if you haven’t drawn up a detailed budget that comprehensively outlines your monthly income and expenses.

“Looking at your income and making a plan as to how you will spend or save it during a month is the best way to ensure that you’re spending the last few days of the month surviving off two-minute noodles or heading back to Mom or Dad for money,” Gil says.

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  1. Pay yourself first

Business tycoon Warren Buffett put it aptly when he said: “Don’t save what is left after spending; spend what is left after saving.”

His advice speaks to the principle of getting into the habit of paying yourself first by putting money aside for your rainy day savings account.

The best way to make sure you follow through with this is to set up a monthly debit order that automatically goes off and saves you the hassle of remembering, and makes sure you don’t make excuses – because there will always be something that pops up!

  1. Make compound interest your best friend

Compound interest is a term every young person should come to know intimately ­– if you don’t, then you’re missing out on serious opportunities to make free money.

Compound interest is sometimes referred to as a millionaire’s best friend as this is a key way most rich people amass their wealth over time.

Think about investing your money in a savings or investment account that earns compound interest (where interest grows interest). The earlier you start, the more time you allow for the interest to accrue.

  1. Get income protection cover

Your income is the most valuable asset you will own at the beginning of your career, and with the current economic climate placing businesses under severe strain, you job may not be as secure as you like to think.

Claim statistics from Liberty show that just under 16% of claims paid to millennials last year were as a result of retrenchments, highlighting the fact that just because you’re young, doesn’t mean your chances of being retrenched are any better than any other age group.

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  1. Know the difference between good and bad debt

Things like a retail account or credit cards, where you owe outstanding debt, are generally considered to be bad debt.

But before you start panicking, not all debt is bad. You need to consider why you are taking out that loan or debt – if it’s for something like a home loan or an asset that will appreciate over time and a loan that you can comfortably afford to service long term, then that’s generally considered to be good debt.

“Debts that allow you to have your basic needs, such as shelter, are considered good debt,” says Gil.

  1. Get a retirement annuity

Saving for retirement is probably the last thing on your mind when you’re in your 20s, but the irony is that if you don’t start saving for retirement early on, it could be the difference between living comfortably in retirement and running out of money… and quickly.

“Unfortunately, a lot of people in their 20s are still battling student loan debt and are accumulating expenses instead of savings,” says certified financial planner Katie Brewer. “This is the age when weddings, baby showers and first-time home buying becomes a priority instead of retirement saving.”

To sweeten the deal, bear in mind that you can get tax breaks from retirement annuities, and the sooner you start saving for retirement, the sooner you can start collecting compound interest.

  1. Resist the temptation to splurge on every fashion trend

Everyone understands the need to look good, and as a working professional you should always aspire to look good.

But looking doesn’t mean you need to invest in every fashion trend that does the rounds. Some trends can be somewhat questionable and you don’t want waste your money on items you could likely come to regret buying.

“Rather save up and spend your money on travel expenses and experiences. These will be far more valuable to you later on and you would have saved up to do this,” Gil advises.