Achieving financial independence in your 20s is an exciting and admirable goal. But to get there, you’ll need to roar, not snore, through the next 10 years of your life.

To get you charged up and put you on a firm financial foundation, we’ve compiled a list of what we feel are 10 must-dos you should implement now while your possibilities are endless and curry the favor of time.

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Like you, we were once in our 20s, too, and felt invincible. But now looking back, we wouldn’t have minded if some wise old financial guru had been looking over our shoulder. Good advice is always in short supply.

In that spirit, we offer the following life and financial tips, hoping you take at least some of them to heart.

Here they are:

1. Re-educate when needed.

Maybe you majored in sociology or the classics or perhaps you’re still in college trying to finish your degree in literature — all noble pursuits by the way. When you graduate, you may be able to wax poetically, but will the economy, of which you are a critical component, place the same value on your linguistic skills as you do? For example, if you discover your roommate, who majored in engineering or accounting, is attracting job offers for double the salary you’ve been offered, how will you deal with that philosophically?

Part of receiving an education –not always taught that well in school — is learning how to hit the curves that life throws you. If you’re looking at $50,000 in student debt upon graduation and the jobs for your vocation are in the $30,000 or $40,000 range, maybe you should try to pick up a few more marketable skills that will boost your salary.

A recent report by the Federal Reserve Bank of New York found that engineering and math majors can expect to get the highest return on their college investment (21 percent and 18 percent, respectively), compared to much lower-earning liberal arts (12 percent) and education majors (9 percent).

Whatever vocation you choose, be passionate about pursuing it, even if that requires that you have to change plans (or majors) midstream. You don’t want any old job, you want a career. If a change is required, make it while you’re relatively young!

2. Continue living the frugal life.

When you’re just starting out, unless you’re some Wall Street wunderkind, your wages will likely be low, so you need to keep a tight lid on expenses. College kids are experts on running around without little cash, but somehow they manage. You’ve got to do the same.

That means less eating out, ditching the car for public transportation (because making car payments gets old faster than that new car smell fades), grabbing a roommate or two to help with the rent, outfitting your place with discarded sofas and night stands made out of milk crates and no longer walking around like you’re a billboard for Abercrombie & Fitch.

At this point, upholding your bank account and maintaining positive cash flow is far more important than wearing designer brands and upholding whatever image you think you have to maintain.

3. Become a better negotiator.

Until you got to college, you probably let mom or dad fight a lot of your battles, but now you’re in your 20s, it’s time to take off the gloves and fend for yourself. What you should learn very quickly is the listed price is rarely the going price — and that goes for everything from the rent you pay to the salary you earn. If you want a better deal, you’re going to have to negotiate one.

For example, if you don’t negotiate your salary throughout your career, you might as well say goodbye to $500,000. That’s the sum of lifetime earnings that estimated people lose over their lifetime by failing to ask for more money.

If you want a padded bank account, you’ll never pay full price for what you buy and never take less in salary than what you’re worth. (That’s why building those marketable jobs skills are so important; they breed confidence.)

4. Rein in your credit card spending and reduce your long-term credit card debt.

As tempting as it might be to load up your credit cards and purchase new furnishings from Ikea for your first apartment, resist the urge. Keep your credit cards for a real emergency. If you consider new furniture indispensable, you’ll blow your budget and rack up debt quickly. A better alternative is to hit a couple of weekend garage sales and show off your negotiating skills.

If you already have sizable credit card debt on which you’re paying the minimum each month, treat this situation as an emergency, which means you need to pay it off alarmingly fast. If your college years taught you anything, it’s that large credit balances carried forward each month will eat you alive in interest rate charges. Currently, people in their 20s have the lowest credit scores of any group (628) and carry more than 23,000 in debt, according to credit bureau Experian.

If you’re carrying several high balances, pay down the one with the lowest credit limit first, since exceeding your credit limit can result in extra fees and, worse, damage your credit rating, which more and more employers are using as a tool on which to base their hiring decisions. Employers’ thinking is simple: If you can’t manage your own finances, how can you be expected to manage your job or other people.

Although 63 percent of all millennials don’t use any credit cards, abandoning cards altogether is not a particularly wise strategy. You need to build your credit score and demonstrate you can use credit responsibly.

5. Clean up your online presence.

Unless you’re in line to inherit a trust fund, much of your wealth will likely come from employment. If you’re currently in the market for a job, you need to sanitize all those party shots of your bacchanal behavior, including all those beer pong photos.

At the same time, update your LinkedIn, Facebook and other professional and social media profiles because today it’s a given that human resources hiring managers use these sites as screening tools. As you know, you live in a virtual world, and if you don’t come across as a pro in this digital space, your job prospects will likely suffer.

6. Insure yourself.

Who wouldn’t rather spend money on a shiny new car before spending it on medical procedure to repair a torn achilles tendon or a broken arm. In your 20s, you probably won’t die of hardening of the arteries, but you can’t count out a snowboarding or car accident that could sideline you for weeks or months.

According to a July study by the Commonwealth Fund, nearly 20 percent of those between the ages of 19 to 34 were uninsured in 2013. That’s not cool, because if you don’t pick up your medical tab, somebody else will have to. Or it will go to collections and damage your credit. 

Fortunately, you can stay on your parents’ insurance until age 26, thanks to the Affordable Care Act, but if you’re older than 26, you need to seek out your own insurance. Today, just one day in the hospital can set you back $10,000, a bill, which if left unpaid, could wreak havoc with your credit, job search and other life goals for years to come.

If you’re not covered by your employer’s plan, take the time to research the available health care plans now available in your state, many of which include subsidies if you’re currently unemployed or not earning enough to afford the premiums. Also, don’t automatically settle for the cheapest plan. Having to pay a large deductible will leave you wondering why you even have health insurance.

7. Insure your living quarters.

You can go on to determine the crime rate in your particular neighborhood. In Los Angeles, Calif, for example, there were 213 crimes committed per square mile in 2013. That should serve as a wake-up call, telling you there are a lot of covetous people out there who want what you have, such as your laptop, smart phone or your big screen, and they are willing to burglarize your place to get it. So, ease your mind by taking out renter’s insurance. The good new is, unlike medical or car insurance, it’s extremely affordable.

8. Put your savings on autopilot.

It’s hard to save at any age, but signing up for an automatic savings plan will help build savings without too much noticeable pain. Typically, you will direct your employer to deposit your paycheck in your bank, which will in turn automatically transfer a designated amount into a savings or investment account you’ve set up.

9. Invest in the stock market for the long term.

Investments in stocks over the long run have consistently outperformed nearly every other kind of investment product.

Sure, the market hit a rough patch in 2008, but those gains have long since been recovered, and again, being in your 20s, you’re investing with a long-term horizon that easily stretches out over another 30 or 40 more years.

“If you start in your early 20s, which many millennials are at that age right now, historically the average potential of that dollar in the stock market is about $1 growing to $17, after inflation, so a very nice return,” says Patrick O’Shaughnessy, author of  “Millennial Money.” “If you wait until you are 40, that potential drops to about $5 by the time of retirement. So youth itself is really the number one investing advantage out there.”

10. Keep your lines of communication open.

In your 20s, while you’re still trying to figure everything out, you’ll likely go through a gazillion different stages, periods and moods, sometimes bright, sometimes dark. It just comes with the territory of being twentysomething. Don’t ever become so unhinged or isolated, however, that you lose touch with your vast network of supporters, friends and colleagues.

How you deal with your 20s will largely determine how you deal with the rest of your life. Anything that you expect to last requires that you first build a strong foundation. Start building it now when you’re tool belt is full of possibilities.

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  • highinterest

    11. Stop sponging off your parents. You’re not only living more of the “high life” than they did at your age, you’re living more of it than they do NOW.

  • Peter Bennett

    I think it’s okay to “sponge” off your parents as long as you have a long-term goal in mind, such as going back to school, as I explain in No. 1, to make more money by developing a marketable skill.