The road to personal prosperity is paved with hard work and discipline, ultimately resulting in financial stability and security.  And while each person finds his or her own way, effective money managers share some common traits.  Many financial success stories, for instance, start with a proactive strategy, setting the stage for positive outcomes, early in life.

If you think it’s too early to start planning your financial future, think again.  Granted, many things are subject to change - and probably will, but setting-out on the right foot gives you the best chance for success.

Build Credit - The Early Days

Young people face an uphill battle building strong credit references.  On one hand, teens and early twenty-somethings have not yet had time to undermine or ruin their references.  At the same time, many young people have few credit interactions to point to, at all.  While it is certainly better than negative feedback, a non-existent financial profile can also present challenges.  For a positive impression, you may need to adopt a proactive stance, purposefully building your financial presence.

Your earliest credit-building opportunities include standard banking practices, such as maintaining a savings and checking account at a brick-and-mortar institution.  In addition to national banks, local credit unions are good places to establish accounts and banking relationships. In fact, credit union membership may open doors to financing and savings tools big banks don't offer.  Effectively managing an introductory credit card is another way to build credit, illustrating your ability to administer a revolving account.  If you qualify for a car loan, timely repayment constitutes an installment credit victory you can build on.

Strengthen Your Financial Literacy 

Financial knowledge and understanding set in over time, giving you the tools needed to make informed monetary decisions.  For the best results managing your financial affairs, devote yourself to financial literacy, going out of your way to fortify your knowledge base.

General economics impact every aspect of your financial life, so maintaining awareness can help you make the most of your financial resources.  Signs from investment markets, for example, show savvy inventors when to jump-in for maximum gains.  By tracking lending conditions, you’ll know when to buy or refinance a home.  Even basic budgeting is often overlooked, leaving families short on planning and long on monetary demands.  A solid financial IQ not only helps with household budgeting, but the wisdom can also help you find and maintain balanced cash flow.

Give Savings Time to Grow

With so many demands straining your budget, setting aside money for the future isn’t always your top priority.  But, investments need time to grow, so turning your back on saving can be a costly mistake.  Even if contributions are small, it pays to start saving at an early age.  Not only will you have longer to build reserves, but money also grows faster when gains are compounded. Consider money invested in your 20s.  As interest accumulates over time, you actually start earning more money on the original investment’s interest.  The cycle repeats again and again, further compounding your earnings, until a small investment grows into a sizable sum.

For steady savings, try automating your approach.  Start by pulling a set sum from your earnings during each pay period.  By reserving your savings before the money reaches your budget, you won’t miss the cash flow but will avoid temptation to spend the money.

Personal planning is integral to your long-term financial health and stability.  While it always pays to tune-in to your finances, an early start gives you the best chance of finding financial security.  Building and protecting your credit score, setting aside savings, and quenching your thirst for financial knowledge are three essential pursuits on your personal path to prosperity.