Today’s blog was inspired by a What’s Hot Blog on the MichiganFirst.com. I was hunting for an intriguing and helpful blog topic and the What’s Hot blog is full of some amazing stuff. The article I read is called, “Financial Mistakes People Make at Different Ages.” Everybody makes mistakes, everybody has those days, everybody knows, what, what I’m talking bout’…(Hannah Montana reference anyone?) As I dove into the article I realized a few things. First, it made me feel a little bit guilty, because I have made these mistakes. Second, I realized if we talked about avoiding the mistakes more, less people would get caught up in a financial mess.
I feel the need to share the common money mistakes people make in their 20’s in the hopes that some of you will be able to avoid these mistakes.
1. Going big or going home, aka, living beyond your means.
Let’s be real here, we all want to buy new products, have the latest electronics and live the #wonderlust lifestyle, but it’s important that we don’t frivolously spend our money in these YOLO years of our life. If we accumulate too much debt, and don’t focus on paying off the debt we might have, it can potentially hold us back in the long run and limit our options.
2. Not asking questions, because we might look dumb.
I had this thought that once I became an “adult” I would somehow understand the processes and terminologies that are used in the financial world. I would be competent and organized. REALITY CHECK, those things don’t come automatically, we have to ask questions, do research and make time to stay organized. We should use our financial institution as a resource and ask them every question we have about managing our money. Read articles to stay up to date with new policies and procedures and PLEASE don’t sign up for an account before you know how much money it will cost you, save you or what kind of benefit it actually has for you.
3. Spending every penny.
I have written countless blogs about budgeting and saving money, but here I go again. It requires discipline and tunnel vision to set aside at least 10% of your paycheck. However, when you are saving money for emergencies and for retirement you will be glad you did when you actually need that money. Look at it this way, would you rather have a new pair of shoes, a new watch or a new bag every month, or would you rather be able to travel the world when you are retired? Start saving now and your small sacrifices will add up to a big reward.
I don’t want to be a stereotypical 20 something. I want to break outside of the box and set myself up for financial success, and I hope this helps you do the same!
Keeping it Fresh, Young & Free,