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Looking back on my twenties, it was the best of time and the worst of times. The best of times, because, let’s face it, I’ll probably never have so much fun again, and the worst of times because I was young, broke, and not in control of my finances.
Here is what I have learned over the last decade that I really wish I could tell my younger self.
1. You really don’t need that pair of shoes
You are only young once, at least that is what I told my twenty-year-old self every time I was staring down a $250 pair of shoes I definitely couldn’t afford on my entry-level salary. Of course, that splurge always ended up having a ripple effect on my finances. If only I had had the willpower to walk away at the time or, at the very least, to do my homework and get the best possible deal I could.
For instance, with Ebates you can get cash back on pretty much everything you buy online, between 2 to 15% at all your favorites stores. I can’t believe I ever shopped any other way.
2. Find any way that you can save
It can be really difficult to think about saving even a dollar when you are essentially earning minimum wage straight out of school. That being said, I wish I had been armed with the knowledge of just how much of a difference saving whatever I could would make for me later in life.
If I had an automatic savings app like Digit in my 20s, that probably would have saved me the headache of trying to figure out how to save on my own. Digit automatically pulls money out of your checking account for you regularly so you don’t even miss it. Before you know it, you’ll have built a nest egg. I missed out, but I shouldn’t have.
3. You have to do more with your money than just save it
While I needed to tell my younger self to sock away money, I also needed to tell her that just saving money isn’t enough, you have to do something with it. That “something” means investing in a 401(k) plan, an IRA, stocks, ETFs, something. There’s a little thing called compound interest that will make all the difference when you start investing early. It’s something I truly didn’t appreciate until later in life.
Don’t let the idea of investing scare you, either, you can get started investing with as little as $5 using Stash, in everything from stocks to ETFs.
4. Cook as much as you can
I spent a nauseating amount of money on takeout and eating out in my 20s. Truly, a cringeworthy amount. If I had cut down on the number of takeout meals I ordered or the times I spent $100 on dinner with friends, I would be light years ahead of where I am financially right now.
Recently I discovered Ibotta, which gives you cash back every time you scan a receipt with an eligible purchase from a grocery store, so now I am saving not only because I am eating out less, but based on how I am doing my grocery shopping. Saving money can be its own addiction once you get started.
5. The little things add up in big ways
A realization about money that I didn’t have until I was older is how much of a money suck the little expenses are, whether that is a $5 latte or a $35 overdraft fee from the bank. If only I had been more cognizant of that earlier, I can only imagine how much money I would have been able to sock away.
An easy way to have eliminated those fees from my life would have been to start banking with Chime earlier–its an 100% fee-free bank, after all.
Besides no-fees, the other big reason to use Chime is the ability to get your paycheck two days early when you’re getting paid via direct deposit. For those days when my rent fell due right before payday, that would have put me at a huge advantage.
6. Realize your the one in the driver’s seat of your finances
It doesn’t take long into adulthood to realize your on your own, in every way, including with your finances. No one is there to pick up the pieces anymore. Because of that, it is all on you baby to do the work to take control of your finances. That can seem daunting at first (it certainly did to me) but once you start to realize there are lots of ways you can help yourself the burden will start to lighten.
For instance, MoneyLion allows you to easily track your credit score and it will send you alerts so you can avoid late fees or overdraft fees from your credit card issuers and bank. Via MoneyLion Plus, you can start investing in the stock market with as little as $50 (most brokerage accounts require a much bigger initial investment) and get approval for personal loans from between $1,000 to $35,000 on the same day.
All of that stuff–investing, getting a loan, tracking your credit score–will feel like a huge burden unless you get the right help.
7. Protect yourself (and your stuff) as much as humanly possible
In my younger years I was robbed, my bedroom got flooded, and my bathroom ceiling collapsed (and this happened in about a two year period). It sucked big time, just ask my bank account.
None of it was really preventable, but I should been more prepared. Things happen, and I could have been armed with renters insurance like Lemonade, which, starting at $5 a month, offers coverage for your personal property and even loss of use coverage in case your home becomes unlivable for any reason. Here’s the real kicker: with Lemonade your stuff is covered even if something happens to it outside of your house, say your phone gets stolen when you’re at a bar.
My older self is currently kicking my younger self for not having Lemonade, believe me.
8. If you don’t have the cash for something, you can’t afford it
It’s really that simple. If you have to put something on a credit card because you don’t have the cash for it, you can’t afford it. Case closed. And, don’t even think about using a credit card if you aren’t responsible enough to pay it off in full each month.
To the same tune, don’t let debt drag you down indefinitely, come up with a strategy for paying it off, and get help if you need it. The app Tally, for instance, will do an analysis of your credit cards and credit history. If you qualify, you’ll get a line of credit with Tally that will be used to pay down your higher APR balances (the savings of doing that can be huge). Whatever you do, don’t enter your 30s and beyond in debt.
9. You don’t need to impress anyone
Keeping up with The Joneses is one of the things that got me in my twenties. It is so easy to want to buy a new dress because everyone else around you seems to be shopping up a storm, or to go on a vacation because everyone else around you seems to be going on a vacation. Here’s the thing, you have no clue how other people are actually doing financially–they could be being bankrolled by a parent or even going into debt to support their lifestyle. So why get caught up in it?
Instead of feeling the need to “keep up” with everyone around me, I should have gotten focused much earlier on being a true boss as far as my finances are concerned. That’s easier said than done, which is why Truebill is so useful. Think of it as your (free of charge) financial guardian angel, there to help you cut subscriptions you never use out of your life, negotiate your monthly bills down on your behalf, and even rid you of pesky bank fees. Essentially, it gives you a birds eye view of what is coming in and going out so you can make smart choices. If only I had been making smart choices sooner.
10. Everything in life is negotiable
It can pay off in a big way to be aggressive about asking for deals, but that’s a lesson I didn’t learn till I was older. The price of my cable bill, the rent, how much I’m paying the person who walks my dog? That’s all negotiable, you just need to have the guts to ask.
(Or have the smarts to know that you can get someone to do it for you, like the service Bill Slasher, which can negotiate your cable and phone bill down for you. They only take a cut if they are actually successful, too).
11. Think to the future and save money at the same time
Saving the planet is increasingly important to me, especially as I’ve gotten older. I only wish my younger self would have appreciated how important it is to take care of the world we live in.
There are lots of things I should have been on top of that wouldn’t have consumed my life, but would have helped the planet, including recycling and even just turning the lights off when I left a room. And I wish I had signed-up for Arcadia Power earlier, which allows people to connect their utility account to enroll in a clean energy and savings program. That means your energy usage supports renewable energy projects, and you end up saving every month on your utility bill. It’s a win win.
Making small but smart choices will go a long way in helping the world.
12. Never say that you’ll pay yourself back
Your savings and your retirement accounts are not a pool of money that you can dip into whenever you feel like it. You put that money away for a reason — to save it and grow it — so its best to pretend its not even there.
Not only should I have considered my retirement money to be in a lock box never to be touched, I wish I had taken the initiative to manage my 401(k) better, sooner. Because I wouldn’t consider myself a total pro in that department, I’ve come to rely on Blooom, a robo-advisor, to do all the work for me.
It stays on top of my 401(k) plan and optimizes my investments every 90 days. Considering how easy it is, it’s silly I didn’t start using it sooner.
13. Making money doesn’t just happen, you have to fight for it
My friends who came out of their twenties in the best financial shape were true hustlers, who did everything they could to earn as much money as they could, whether that meant asking for raises regularly at their jobs or taking on a side hustle (or two, or four) in their spare time.
Just think of the nest egg I could have built if I had become a Lyft driver in my spare time in my twenties, earning a few extra hundred dollars a week for just working a few hours? It might have been enough to save for a down payment on a home.
14. Find ways to have fun that don’t involve spending
In your twenties life so often feels divided between the points of time that you have money and the points of time that you don’t. It doesn’t have to be that way, there are so many ways to have fun that don’t involve spending a dime. If only I had known to appreciate those all-night dance parties in friends’ apartments or hanging out in the park with a book for what they are: awesome free fun.
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