The first account that you need to fund is your Emergency Savings.  Your emergency savings (which can live happily in your [1] savings account) holds enough cash to allow you to weather any temporary financial downturns - an accident that keeps you from working, losing or changing jobs, replacing the brake pads and rotors on your car - without resulting in late payments and a trashed credit score.  Having an emergency savings account offers tremendous peace of mind and confidence to a twentysomething.  Fund your emergency savings, and chances are good that you will be in better financial shape than your parents were at your age. 

How much should you hold in your emergency savings?  As much as you need to feel comfortable.  Many experts recommend 3-6 months worth of living expenses.  If you can amass that kind of savings, definitely go for it.  You can use [2] these planning tools to determine how long and/or how much you will have to save to reach a certain goal.  I would much rather that you saved something rather than being intimidated by a large figure and saving nothing.  For now, saving one month’s worth of living expenses is a great start.

For many twentysomethings, saving as little as $100 each month for a year or two will result in an emergency savings account that will easily cover 1-2 months expenses.  Again, if you can comfortably save more, do so.  Begin with 10% of your monthly earnings, which is a fairly comfortable savings target.  As your emergency savings account is very liquid, you can easily move excess savings into retirement accounts or apply them towards other goals later.