If you’re a millennial, you’re very lucky because time is on your side (but don’t be too lax because it won’t be for much longer).

I was exposed to financial planning at a fairly young age and what I’ve come to realize is that when it comes to achieving what you want in life, it is indeed a big deal if you start sooner rather than later. If you wait too long until you reach your 40s or 50s, for example, you will have to save and invest a much greater chunk of your income to accomplish true financial stability.

To share some of the wisdom I’ve learned from my own and other people’s experiences, here are some tips on financial planning that every millennial should know:

1. Don’t live paycheck-to-paycheck.

If you are living paycheck-to-paycheck, you’ve got to stop right now. Living this way means that even the smallest unexpected expenses will cripple you. Track your expenses and determine where you can cut down your spending. This way, you will have the ability to save without being required to find ways to make more money.

2. Plan a budget and stick with it.

Monitor where your income goes and plan your budget. You must update it regularly to match your lifestyle and goals. Once you’ve fully grasped your true cost of living, you will have more power to take control and prepare for huge expenses. More importantly, you must stick with your budget as much as possible.

3. Make saving money a habit.

Achieving financial stability starts by learning how to save. Furthermore, you must know how much to set aside depending on your goals, but experts suggest that you should save at least 15 percent of your income.

Some tips on saving money include:

• Limiting your credit card debt. While credit cards are very convenient, they can tempt you to spend more than you can actually afford. When you have a huge credit card debt, you will have less to save. Plus, I can’t think of a bigger waste of money than paying interest on credit cards.

• Establish an emergency fund. Unexpected events can occur and may cost you a lot. Hence, it is important to save sufficient funds that can cover 3 to 6 months’ worth of your essential expenses.

• Prepare for your retirement. Although your retirement seems far down the road, you should start your retirement savings in your 20s rather than waiting until you reach your 30s.

4. Start investing at an early age.

Instead of saving all you money in the bank, you can make it grow by investing it in the stock market or in other forms of asset. This way, you will be able to accumulate more money at a faster pace. But before you start, you must understand the following:

• Do not venture too much and too fast. It would be better if you go slow but steady, This means that you should invest at particular amount of money that you can afford to lose at regular intervals. The next thing you know you’ve already grown your portfolio.

• Diversify your portfolio. As the saying goes, you should not put all your eggs in one basket. If you do and the market crashes, all your hard-earned money will be gone in a snap. It is recommended to invest in a wide range of assets across different sectors.

• Know the ins and outs of the market. In order to profit from investing, you must know the ins and outs of the market that you are planning to invest in. If you don’t understand your assets and you are not updated with market trends, it is highly likely that you will make bad investment decisions.

• Manage your risk. The higher the risk, the greater the reward. Don’t be afraid to make risky investments, but make sure that you know what you’re getting into and that you only invest what you can afford to lose. Also, there are a lot of risk management strategies that you can implement to protect your portfolio from significant losses.

5. Seek financial advice from more experienced people.

What better way to learn than by seeking advice from the more experienced? You don’t have to actually talk to financial analysts or advisors (though it could help if you know someone), you can have discussions with your parents and learn a thing or two when it comes to managing your finances. Also, you can join webinars and conferences or take advantage of online materials about financial planning.

Final thoughts

It is not too early to start educating yourself about money and striving to achieve financial stability. By doing the tips mentioned in this article, you will surely be able to reach your financial goals and retire young.