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7 Finance Lessons I Wish I’d Learned in My 20s

Hindsight is 20-20, is it not? I got into a mountain (not a molehill, a mountain!) of debt in my 20s. I made several mistakes, and still had credit card debt by the time I turned 30. I don’t regret anything, but if I were able to get into a time machine and visit myself in my 20s, I would have a few pieces of advice, and some of them would have to do with money!

 

I can’t say that my 20-something self would listen to the older, wiser version of me, because in my 20s, I was heavily afflicted by know-it-all-itis, which many of my peers suffered from as well. But if I had heard, and listened? Let’s just say I would be much wiser by now.

 

  • Money Tips I Wish I Learned in my 20s 1 of 8
    PicMonkey Collage
  • There’s Value in Delaying Gratification 2 of 8
    Frugal Portland loves bubbly

    Here's the thing. Even though you have income and credit cards with ridiculously high limits, you cannot (and honestly, should not) buy everything you want. In fact, we like something better if we don't have it all the time, and we value something more if we have to save for it. This would have been a valuable truth to understand.

     

    Image by FrugalPortland

  • Max Out Your IRA 3 of 8
    IMG_3968

    I know, 20-something self, that there are far more fun things to do with your money than maxing out your IRA, but just ... do it. Pay your future self. You had all that room in your budget for eating out all the time, didn't you? So just flip it, pay $400/month toward your IRA. Compound interest is in your favor, sweetheart, and never moreso than when you're in your 20s.

     

    Image by FrugalPortland

  • Don’t Accrue Interest on Credit Cards 4 of 8
    credit card

    Groan. This is the one piece of advice that, had I listened to it, would have made my life much less of a financial struggle. If you have a credit card, that's great, but you should never (and I repeat, NEVER) carry a balance from month to month. That does not do you any favors, and the big banks don't need more money.

     

    Image by nacu

  • Take On As Little Debt As Possible 5 of 8
    IMG_3382

    Don't finance stuff. As much as you can, just save your money. Don't buy a car, don't finance a couch. Minimize your debt, don't maximize it. Try to get rid of it as soon as possible.

     

    Image by FrugalPortland

  • Question the Graduate Degree 6 of 8
    file0002135280483

    I see that LSAT study tips book. I know you got a degree in politics so this is the natural trajectory, but let's talk. Do you actually want to be a lawyer? Or are you trying to delay real life because you know you're good at being in college?

    This is actually a piece of advice I listened to. I interviewed several lawyers, and realized that I did not want their jobs, ever. So, if you're in the same boat? Post-college, not really sure about the next step? Ask tough questions and make sure graduate school is the right path. Otherwise, it's just adding more debt (which we already discussed!).

     

    Image by click

  • Your Credit Card is Not an Income Source 7 of 8
    IMG_2238

    You should never think of your credit card limit as a goal you'd like to reach. No, sweetie. Just because Bank of America thinks you can have a $20,000 limit on your credit card does not mean that you should write a check (in any amount!) from your credit card. Nor should you think about this credit card in terms of supplemental income. If you look, the interest rate on the card is only marginally better than what the payday loan sharks are offering.

     

    Image by FrugalPortland

  • You Don’t Need to Keep Up 8 of 8
    IMG_2286

    Yes, your friends are doing really well for themselves. And they're buying expensive things (yes, those shoes do in fact belong to someone I know!). But you don't have to. Your friends won't think any less of you if you don't have the same designer duds they do. They won't even notice if you buy the cheapest thing on the menu when you're all out. They just want to spend time with you.

     

    Image by FrugalPortland

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