Notice: Hi! This article is a part of a series in line with a financial literacy project I am co-leading by the name of Absolute Cash (@abosolutecash.pmfl).

In recent times, college debt has only increased among students, as after college graduation, the average debt they owe increased by 56 percent, from $18,550 in 2004 to $28,950 in 2014 (youth.gov). However, to battle such struggles, the teenage population is struggling with mediocre financial literacy rates, as only 62% of teens know about saving, 50% about earning, 44% about saving for college, and 42% about budgeting (annuity.org). Being financially literate, especially from a young age, such as in high school, is necessary so you can have adequate money for retirement, graduate from college while being debt-free, and make sound financial decisions in the future. And as a survey conducted by Absolute Cash suggests, 80% of respondents feel that financial literacy is an essential skill, and we hope to help you become equipped with said skill through our campaign.

Planning your retirement from a young age is significant to ensure you don’t run out of money by the time you retire. If you don’t have enough money saved by the time you retire, you may have to come out of retirement and start working again. Therefore, a good retirement plan is imperative to make you more stress-free in the future, helping your physical and mental health. In addition, with a solid retirement plan, you can have fewer income taxes. So a way for you as a high-schooler to start planning for retirement is to invest in a Roth IRA, an account for retirement. If you start investing in it at an early age, like 18, you can have hundreds of thousands to millions of dollars in it for when you retire, depending upon how much you invest, and when you withdraw the money, that money is tax-free. Furthermore, if you are 18 and have a job, then you can invest in an employer 401(k) plan with significant tax benefits, and if you were to quit your job for another one, most of the time, your 401(k) should roll over into that new job.

Furthermore, it’s critical to plan for college as 1 in 7 Americans are in student loan debt. College can be expensive, especially if you don’t qualify for free tuition or don’t get many scholarships. Nevertheless, don’t worry if this applies to you because there are many ways in which you can still save money for college. 529 plans, ESA Accounts, custodial accounts, and prepaid tuition plans are some ways you can save money. Your parents can start a 529 for you as soon as you get a social security number and what this plan does for you is it’s state-sponsored that enables your parents to save money for you and pay for your education expenses. You can also withdraw funds tax-free to cover nearly any college expense. An ESA account is similar to a 529 plan, but for the ESA account, there is a contribution limit, an age restriction, and an income restriction. A custodial account is also similar to a 529 plan, except there is more flexibility with the investments.

Going out of college debt-free is very helpful, as when you get a full-time job and start working, you can focus on other things like credit. Credit is noteworthy because improving your credit helps ensure you are qualified for loans when necessary. More importantly, credit scores also help with your student loans. No debt and a good credit score will also help you with your house mortgage, car loans, and any other medical expenses in the future.

I know the future can seem daunting and financial literacy can seem overwhelming to many. However, Absolute Cash is a project that provides bite-sized financial literacy tips to prepare students for a debt-free future. Check out its insta handle (@abosolutecash.pmfl as aforementioned) for more information, and stay tuned for webinars and videos that will keep you stress-free and debt-free!