There will always be newfangled strategies and money trends, but the basics rarely deviate over the years. If you want to be successful with money from a young age, you need to follow tried and true principles.

6 Timeless Personal Finance Tips

There’s more than one way to manage money. But regardless of the financial ideology you subscribe to, you can benefit from implementing these principles in your twenties and early thirties:

1. Spend Less Than You Make

The number one way to be successful with your money is to spend less than you make. If this sounds like common sense, that’s because it is! Unfortunately, most people lack common sense. As a result, we live in a nation of debtors.

By spending less than you make, you create margin in your life. This money can be used to bolster your emergency fund, invest, or spend on things that add value to your life. 

2. Get Some Skin in the Game

The best time to invest in the stock market was 10 years ago. The next best time is today. If you don’t already have some money invested in good growth stock mutual funds, this is your moment.

The best strategy is to put money into a tax advantaged retirement account where you can reduce your tax burden and build a nest egg that can be tapped later in life. This is especially important if you have an employer who offers a match program. When an employer matches a percentage of your contributions, they’re giving you free money. Don’t miss out!

3. Don’t Buy a House Prematurely

If you’re a renter, you’ve probably heard people tell you that you’re throwing money down the drain. In other words, 100 percent of your rent payment is going back - never to return. And while it’s true that home ownership allows you to recoup some of your monthly mortgage payment in the form of equity, this factor alone isn’t enough to justify buying a house.

Home ownership is great, but it’s also costly. And if you buy a house before you’re ready, it could do more harm than good. Between interest, taxes, insurance, maintenance, and repairs, it’s possible to dig yourself even further into a hole. 

4. Put at Least 20 Percent Down When Buying a House

Most people eventually reach a point where they’re financially and emotionally ready to buy a house. If that’s you, good! But before starting the purchase process, be certain you have enough cash saved up to make a 20 percent down payment. 

Not only does a 20 percent down payment lower your monthly payments, but it also allows you to avoid private mortgage insurance (PMI), which can amount to thousands of dollars per year. Here are some useful tips to help you save for a large down payment.

5. Avoid Car Loans 

Few things will deplete your finances faster than a car loan. While it’s true that most Americans carry auto loans, you can (and should) be the exception. Why? Well, let’s run some quick numbers.

According to Dave Ramsey, the average new car loan totals $32,797 with monthly payments of $554. That might not sound like an exuberant amount, but it is. Invested into a 401(k) or Roth IRA over a period of 40 years, you could turn $554 into more than $6.5 million. (Ramsey uses a rather aggressive 12 percent annual rate of return, which is pretty unlikely for most. But even if you cut that rate in half, you’re doing pretty good.)

6. Invest in Yourself

Investing in stocks, bonds, and real estate is important, but these aren’t the only investments you should be making. It’s also wise to invest in yourself. Doing so will allow you to earn more money, be happier, and reap financial gains for years to come. (Good investments include books, courses, and business assets.)

Become a Master Over Your Money

You can be a slave to your money, or you can learn to master it. If you implement these proven personal finance principles and tactics, you’ll significantly increase your chances of the latter. You’re never too young to be smart with money. And those who start early tend to reach success much sooner than their peers. Are you willing to make some sacrifices today to enjoy a better life in five, 10, and 15 years?