Money Mistakes 20-Somethings Often Make

Your 20's -- You have to love this stage of your life because, at this point, you're beautiful, healthy, excited for life, and (probably) have a new-found feeling of independence. You're legally an adult, but still have the creativity, curiosity, and vigor that can only come from youth. It's exciting and terrifying, but you just can't wait to get started on this new chapter.

 

WAIT.

 

Don't just dive into young adulthood headfirst. So many people have and, while some might have been lucky, a lot of people in their 20's have fallen deep into financial ruts that you wouldn't want to fall into. To make sure that you don't follow suit, here are a few common money mistakes that 20 somethings often make:

Not Investing On Health

When you're young, healthy, and beautiful you don't really think much about taking care of yourself in terms of nutrition. Your metabolism is fast, so weekly fast food binges are no problem, and exercise is not a priority. You feel invincible and energetic, so you can stay up for days at a time -- no problem. What you may not be considering is that the vigor of youth wears off faster than you may think. People with blood pressure problems are becoming younger and younger, more of our youth have problems like diabetes, and even those who are 30 and under can suffer from stroke or heart attack. The point is that, you can save so much on hospital bills and medicinal maintenance in the future if you start taking care of yourself now. Invest on a gym membership or even just jog for 30 minutes every morning. Invest on vitamins and healthier food. Not sure what to eat? Ask help from a nutritionist to give you a proper nutrition program for your body and lifestyle. Trust me, you and your wallet will thank me later.

 

Not Thinking of Retirement

This goes for some 30 somethings as well. Most people don't really think about retirement plans until they actually need it. It may seem like you can't afford it yet but if you really think hard about what your spending, you'd realise that you're spending for a lot of things you don't really need. Even just 5% of your salary is a big thing if you put it away religiously do it until you're 65. Maybe a little less on shopping, wining, and dining, and a little bit more on saving, yeah? Maybe you're thinking that retirement is a world away from where you are now. Don't fall into the myth of "it's too early" -- it is never too early to save. Just remember that the earlier you save, the more you'll have when the time comes. Trust me, you don't want to end up old with financial difficulties and relying on your children to keep you afloat. Yes, that is typically frowned upon by our society of independent people so save, save, save! Who knows, you may just save enough to travel after retirement.

 

Living A Lifestyle You Can't Afford

Let's say a year after uni, you meet up with old friends and you find yourself turning green with envy as they drive around in flashy cars, dressed in designer clothes, and flash the latest gadget they're absolutely in love with. You try to keep up, buying Hermes scarves, Prada bags, and other pretty things that would make anyone's heart flutter. You get a car loan to have a flashy car you could barely afford so you can drive to the finest restaurants for Sunday brunches and fancy dinners with snazzy pre-dinner cocktails. Before you know it, you're on a downward spiral and deep in debt.

 

There is nothing wrong with experiencing the finer things in life -- that is, if you can afford it. Don't fall into the trap of a glamourous lifestyle. When times get tough or when emergencies like sickness in the family arise, it's always good to have back-up in the bank. You won't be able to have that if 80% of your money is going to luxury items.

 

Remember that someone who earns a million a year is still broke if he's left with nothing by the end of the year. By the end of it all, the richest person in the group is the one who has money in the bank, and maybe even a few things to brag about in his or her investment portfolio. You'll be the smartest 20 something year old in world if you make steps to avoid these money mistakes. Spend wisely, budget for what you need, and save up for the future. Good luck!