In current times, many people are literate. They have great knowledge and hold degrees from top universities of the world. But when it comes to financial knowledge and decisions related to money, only 16% of millennials are financial literate, shows a study from Tiaa Institute.

Such numbers are concerning. Many individuals, who start working, do not keep savings for any emergency in the future. And it is a common way of living nowadays, because youngsters’ belief in YOLO (You Only Live Once) is considerably greater than their logical brains. Not realizing the damage they are doing to their lives. But among them, many millennials wake up and realize the importance of saving money and budgeting. If you are looking for how you can start budgeting in your 20s, then this is where you will learn about it. 

What is budgeting?

e-transfer Loans in Canada

Budgeting is a technique that helps people segregate your income and use it effectively and in a controlled manner. This allows you to develop positive habits with money and spend it wisely. Surely you will make mistakes and do unnecessary spending, but slowly the habit of budgeting will improve your money management and ensure that you never run out of money. 

How can budgeting help you?

  • Let’s understand it better with an example. Let’s say there are two people, Harry and Alex, both 20 years old and have just started to work. Both earned a monthly income of $3000.
  • From the very start, Harry started budgeting. Harry allotted his income based upon a basic 5:3:2 rule, in which he spent 50% on his needs, 30% on enjoyment and saved 20%; we will further discuss this rule in the latter part of this article. At the same time, Alex was outgoing and spent his paycheck on parties and enjoyment. 
  • A year later, a crisis similar to Covid arose, and both lost their jobs. Here, compare the situation of both of them. Alex, who spent all his earnings, was having difficulty coping with the expenses and was forced to move in with his parents. Harry still had $7200 with him because he saved 20% of his total income for one year. 
  • Budgeting your income and sticking to it helped Harry to deal with unforeseen circumstances and deal with it efficiently.
  • Similarly, several times in our lives, we may face an unforeseen situation that can hit us hard, but we can reduce its impact on our lives if we are prepared for it.
  • Once you get confident in managing your money, you can also mingle with loans and add them to your budgets. Many institutions require a credit score to evaluate your creditworthiness, but when you are in your 20s, you usually don’t have a credit score. So, many online lenders in Canada provide e-transfer loans with no credit check. Therefore, these institutions are a big help for you in difficult times.

How to Start Budgeting?

Pay yourself first

  • Paying yourself first is the most important rule of all. So, what does it means to pay yourself first? You may have already heard people saying, ‘pay yourself first,’ but never really understood what it means.
  • So, in simple terms, when you make a budget and allot a portion of your income for savings or investing. Then this portion should be the first thing you deduct from your salary. Saving the allotted money before paying any bills or expenses is what it means to pay yourself first. 

Set goals

  • Before starting anything, you need a goal. Set a goal for your budgets. Ask yourself what you are budgeting for? Maybe you want to go on a trip or buy an expensive item. So having a goal will make it easy for you to take care of every other expense when you have set allotted budgets. 
  • For example, let’s say your goal is to buy a guitar in the next 3 months,  you would decide on which guitar you want to buy and allot a budget accordingly. This will help you accumulate money systematically each month without putting burden on your any other budgets. Your goals can be long-term or short-term. 
  • Of course, emergencies are not a part of this budget, but they may happen anytime. So you can use either the allotted money to pay for it or get an e-transfer loan with no credit check from an online loan lender. As you are able to stick with the budget, getting a loan and managing it won’t be a problem for you.

Follow 5:3:2 rule

  • Finally, the 5:3:2 rule. It is one of the most popular budgeting rules, perfect for people who have just started working and are begining with budgeting. According to this rule, you should spend 50% of your net income fulfilling basic necessities, such as food and rentals.
  • Being young is a great feeling, and you wouldn’t want to spend these days continuously struggling and hustling (unless you want to). So, enjoy the 30% of your income, buy that dress, get that phone or enjoy that trip. 
  • The last 20% of your income should be saved or invested. This will act as your backup on rainy days. You can multiply it, invest it, put it in RD, FD, SIP or anywhere you want. 
  • This is the basic and the most popular budgeting method. If you are facing difficulty setting your budgets, the 5:3:2 rule is the best start. 
instant e-transfer Loans in Canada


Money management and budgeting are crucial life skills that are not taught to us in schools and colleges. The only way to learn about them is by making mistakes, and till the time you realize your mistakes and work on them, you already have a ton of responsibilities over your head and then playing safe is the only way left for you.

Being young and earning while learning about money is the best way to secure your future. You can learn to manage money but still fall short of it. It happens, and is a common occurrence in every person’s life. In such times, you can apply for no credit check e transfer loans and take care of your immediate expenses.