10 Huge Money Mistakes To Avoid in Your 20’s

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As my 30’s are quickly approaching (eek!), I felt it was appropriate to share some nuggets of wisdom regarding money mistakes I’ve made over the past decade.

If you are in your 20’s, LISTEN UP!

These few years are literally some of the most CRITICAL years when it comes to money. Doesn’t feel like it right now, but it seriously is.

I have made a handful of money mistakes. I admit to it. But over the last few years I have complely transformed my financial situation and am on the path to fully retire before the age of 38 (that’s my goal!). In fact, my goal is to be financially free within the next few years!

But…as an average American, with an average house, in an average town, with an average job…how is this possible?

Simple: I TOOK ACTION.

Be sure to read through all the points below. I included a handful of other resources to guide you to all the steps I’ve taken throughout this financial journey!

1. You Don’t Know Your Net Worth

This is #1 for a reason.

If you’re in your twenties, you probably have STUDENT DEBT. I know I did – and still do.

You also probably have some credit card debt, and maybe even debt from a car or new house.

Tracking your net worth has got to be the most important and critical step you can take to begin a journey to debt freedom…and one of the BIGGEST mistakes you can make if you don’t do this.

Reason being, by seeing all of your assets and liabilities in one place, you’ll have a better idea of your real financial picture. I didn’t start doing this until just a few years ago.

I was too afraid to admit being in debt.

Go and learn your net worth now! Without this step, others just don’t make sense.

2. Going to Graduate School

I KNOW, I KNOW. Don’t hate me.

Thing is, I went to graduate school! I got a DOCTORATE for goodness sakes. Yet, my degree does not nearly pay enough to quickly get rid of tens of thousands of dollars that is stuck to my name.

I had created a successful plan to graduate undergrad for free, but graduate school was far too expensive to pay for over those three years.

(Psst!: Check out my Instagram to stay up to date with my loan payoff journey!)

And sure, I know plenty of opposing opinions, from the argument that you can consolidate your loans and save on interest, and that some professions flat out require more school (I’m one of those situations).

Here are my thoughts on graduate school:

Unless you will get a significant pay raise or job opportunity, it really may not be worth it
If you must, choose online options. In-class courses end up taking more of your time in the end, due to travel and lecture time.
Getting a degree from a bigger school is NOT necessarily worth it. Rule of thumb that I’ve always stuck to: If it isn’t Ivy Leagus, it isn’t any better than your local college.
Most information you could ever want can be found for cheap online through courses

3. Never Saving Money

For many, your 20’s are a time of exploration, fun, and experimentation.

I have turned my 20’s into a time of SAVING for my future.

Remember how I mentioned that I have a goal to be financially free within just a few years? It’s only possible because I have been saving like crazy! I save to pay off debt, have a solid emergency fund, and to invest in rental properties.

One of my favorite ways to save is through a fun app that helps me to set aside the change that I don’t spend so that I can invest it to grow into dividends – and therefore make me more money!

If understanding your net worth is your backbone, saving money are your ligaments. This keeps everything aligned and prevents big issues down the road.

To learn more about saving money, here are a few popular resources!:

4. Being Afraid of Investing

Ah yes, my favorite topic!

I have written extensively on this topic, so I’ll leave you with a few articles to check out and a few FREE apps to download right away!

Investing in your 20’s compared to your 30’s or 40’s can literally mean a difference of MILLIONS down the road. Seriously. Millions.

And we’re simply talking about an average American. No hedge funds here.

Be sure to check out some of my articles for brand new beginners on investing:

Free investing apps you really should download right now:

Robinhood – Why? You literally get free stock
Stash – Why? You get free $5!
Acrons – Why? You get free $10!

5. Having No Goals!

I’ll keep this one short a sweet: To retire early, to achieve debt freedom, to make passive income… YOU NEED GOALS!

I put together a full article about how to make a vision board so you can learn how to do one of the easiest methods of goal-making.

I also created a post about unique methods to achieve financial freedom , from Fung Shui to Law of Attraction, so you have plenty of options regarding making AND ACHIEVING financial goals! Be sure to check these out!!

6. You Aren’t Working SMART Enough for Your Money

It is almost uncommon to find anyone WITHOUT a side hustle!

I have friends who do photography, drive for Uber, sell on Etsy, blog, or simply earn from investing dividends.

The reason is to build discipline, earn money to pay off debt, and put in the hard work now so you can finally live the life you want!

There are a million ways you can earn extra money – so here are the ways I do it!

Blogging: I earn at least $1,000 each month by blogging, yet I only put in around a max of 5 hours per week. It’s a pretty sweet way to make extra cash! If you’re interested, start here!
Selling on Marketplace: My husband, J, makes wooden pallet creations and sells on Facebook for a profit of around $50 per piece! It is a great way to make extra cash to pay for normal expenses
Rental Investing: We currently own one property but have huge goals to own many more in the near future. We earn a steady cash flow each month from our one house alone!

7. Buying a House You Really Can’t Afford

We all hear it from our parents: “A house is a smart investment!”

As an avid believer in the power of real estate investing, I am here to tell you that there are ways to use a house to your advantage to make money!

There are two phenomenal books I highly suggest you put on your wishlist:

These books COMPLETELY changed my husband’s and my views on buying a house. We plan on purchasing our house hacking property in a few months so we can save over $900 each month!

If you’re interested in learning how to make your home a rental, check out the details of how I purchased my first rental property!

8. Eating Away Your Savings

I made sure this was on my list, because it is SO IMPORTANT.

Eating out, buying coffees, and ordering food is a significant money waster. We ALL know it. Yet, it is so hard to change.

The reason I am so passionate about eating at home, meal prepping, and making my own coffee is because of the HUNDREDS that I’ve saved over the past year of making these changes. I’ve written about it a ton on my Instagram, so be sure to head over there to not miss out!

9. Paying for Everything in Full Price

One money mistake I was guilty of over this past decade was not being savvy with savings.

I am proud of how good I am with saving money, but I see far too many friends buy everything in full price, and I cringe at the thought of how much money they’re losing out on!

Here are some examples of ways over the past year that I have saved by not paying full price:

I bought a new FitBit watch off eBay for a quarter of the price it was being sold at stores
I’ve used Groupon to buy a handful of different classes and gifts
I saved hundreds on my wedding by buying everything from my veil to decor off of websites like Amazon
I only buy books used. Amazon is a great place to find used books and I’ve saved a ton over the years.

Saving cash on everyday items is simpler than you’d think. Whenever I want to buy something, I challenge myself to think about how I could get it cheaper.

Could you find a gently used version from someone off Facebook Marketplace or eBay? Would a store like Ross or TJMaxx have it for cheaper? Could you go to that place for less by buying off Groupon? Is a similar item at a store like the Dollar Tree?

In the end, the money adds up! Especially if you’re focused on achieving financial freedom like my husband and I, saving a few hundred dollars a month really helps!

10. Not Learning the Basics of Money

I left best for last!!

One huge mistake you’re making in your 20’s is not educating yourself on money. Seriously though, money REALLY is not hard to grasp.

Yes, things like forex, Bitcoin, day trading, and other investing methods can be really confusing and risky.

But the journey to financial freedom and understanding really basic investing principles only takes a book or two and BAM you’re good to go!

Therefore, I have got to admit that I am a huge reader. I listen to audiobooks on my way to work everyday and knock out a book a week.

Here are my TOP recommendations for anyone who wants to learn about money!!

There are seriously so many other books I recommend. These are great options for anyone who wants to learn but really doesn’t know where to start!

What other money mistakes would you add to this list? Comment below!

(Come follow my journey to financial freedom! Check out my Instagram and follow my profile!)