Many people today start off adulthood on a financially shaky foot. With so many degree-holders graduating college with a mountain of student loans, it's common for millennials and Gen Zers to kick off their careers with no savings and piles of debt.

The problem is so bad that 54% of Americans aged 15 to 36 say they've already hit financial rock bottom, reports the Principal Foundation, the nonprofit arm of Principal Financial Group. Specifically, 20% in that age group feel overwhelmed by debt (including that of the credit card, auto, and student loan variety), while others cite job loss as a reason for feeling financially hopeless.

If you're in a similar boat, you should know that there's plenty of opportunity to change your financial picture for the better. Here's how.

Young woman sitting at laptop, holding her head.


1. Build some emergency savings

A big reason so many people of all ages land in debt is that they're ill-equipped to handle unplanned bills. If you're looking to dig out of your financial hole, the most important thing you can do is build an emergency fund -- one with enough money to cover three to six months of essential living expenses.

Why the need for that much savings? Having several months' worth of living costs in the bank could tide you over in the event that you lose your job and don't find another for quite some time. An emergency fund can also help you avoid debt when unanticipated expenses rear their ugly head.

The Principal Foundation reports that 45% of younger Americans don't have $500 in a savings account. If that sounds like you, get yourself on a strict budget and spend minimally on nonessentials until you've amassed some cash reserves.

Another option? Get yourself a second job on top of your main one. Doing so will help you build emergency savings quickly, all the while buying you some income security in the event that you're faced with a future layoff.

2. Devise a debt payoff plan

A large number of young Americans are drowning in debt. If you're one of them, use the above tactics (cutting spending and getting a second job) to free up cash, and use that money to pay off your obligations. (But only after your emergency fund is complete -- that needs to come first.)

Your best bet is to tackle your debt with the highest interest rate first, and then move on to less expensive debt. For the most part, that means starting off with your credit card debt, and then moving on to pay off your vehicle and student loans. Keep in mind that depending on your income, you may qualify for a tax deduction on your student loan interest, so that could be a good reason to pay off that debt last.

3. Start securing your retirement

An estimated 49% of younger Americans think having a good credit score is more important for their financial future than having strong savings. But while solid credit will make it easier for you to borrow money affordably when you need to, ultimately, your future financial security hinges on having money to your name -- money in the bank for emergencies and money in your IRA or 401(k) for retirement.

Once your emergency fund is complete, you should divert your extra money to your nest egg. IRAs currently max out at $6,000 a year in contributions for workers under 50, while 401(k)s max out at $19,500. But you don't have to hit those maximum levels to make strides on the retirement savings front. If you start contributing a mere $100 a month to a retirement plan at age 25, and continue doing so until age 67, you'll wind up with about $277,000 in savings, assuming you invest those funds at an average annual 7% return, which is doable if you go heavy on stocks.

If you're worried you've hit financial rock bottom, don't despair -- a few strategic moves on your part could change your outlook for the better. Remember, too, that you're never too young to seek help in managing your finances, so if you've been struggling to do so alone, seek out recommendations for a good financial advisor. You don't need to be wealthy to work with one, and it could be a good way to get valuable, customized advice that shapes your future for the better.