9 money mistakes 20 year-olds make.
At 20 to 29, most young adults working or making money tend to make fatal financial mistakes. After all, you feel you are young, energetic, and rich. Money matters are rarely talked about in schools. Most students work to get employed and become successful. Very few young adults think of making more money at this stage, because they feel what they have is enough. Here are 9 money mistakes 20 year- olds make.
1.Partying
You are just from being a teenager, whereby you were involved in many parties. At 20 yo have to grow up and focus on more important matters. If partying is very important to you, make sure you can afford that lifestyle all the time. Work towards making more money and investing. Everything that happens in parties, will drain your finances.Indeed, parties will not build you positively.
2.New car
Once you start working, your main focus is on buying a new car. Probably because you want to fit in a certain class. One thing you should know is that the car’s value keeps on depreciating. If you must buy a car, make sure you have other side hustles that can cater to it’s fuelling, insurance or repairs. You can opt to buy a second-hand car, which will be a bit cheaper.
3.Poor credit
A number of 20 year olds do not care about their credit score. They spend all their earnings and survive on debts. This will destroy their reputation with bankers. If you are in your 20’s focus on living a debt-free life.
4 Eating out
Loving yourself doesn’t mean eating out every day. Probably during the quarantine period, you learned that cooking is important. It is good to learn to cook even the simplest meals. You never know how much you are going to save on food if you start making your food. Youtube channels are there to teach you various recipes. Actually making your own food is very healthy.
5.Surviving without a budget
Schools did not teach many people on money management. Probably even your parents did not teach you about money.This is not the time to blame people for your failures.The moment you realize you are making mistakes with your money, work towards reading financial books, or watching financial seminars. Start knowing on how to budget on your money and you will become more responsible.
6. Not paying student loans on time and acquiring more loans
When you start earning in your 20’s focus on clearing debts. You can start an investment/ a side that will help in paying off your student loan. Unfortunately, what many young adults do is that they accumulate more loans. They venture into activities that cannot pay back all the money borrowed. If you are that kind of person avoid debts at all costs. The interest rate can be high such that it will take you many years to be financially stable.
7 They don’t save
All the monthly income earned by almost 20 years old is spent within the first two weeks. probably if they have no budget they don’t have a savings account. In case of an emergency, they are forced to borrow money. This can be very embarrassing for a person who is working. Have different savings accounts to cater to various needs.
8. Spending money on designer/labels
Most young adults are naive. They do not know that it takes a lot of effort for someone to earn an expensive lifestyle. They do not question themselves when buying a shoe worth someone’s whole year’s rent. It is not bad to buy all those things, the main focus is that you can actually afford them. Do not live above your means. Live a simple life and work towards achieving greater.
Instead of regretting in your 30’s work towards investing in yourself. This will include mentally and even doing financial investments. If you avoid the 9 mistakes most 20-year olds make, you are going to be a happier person in your 30’s. In conclusion, we can say that you have to sacrifice inorder to succeed in your 20,s.4 principles you should learn about money.