finance

"The 9 money mistakes I made in my 20s that I will never, ever make again."

It wouldn’t be your 20s without kissing a few too many frogs, waking up fully clothed with a world-changing hangover or spending a few months living pay cheque to pay cheque (some longer than others).

They say that your 20s are meant for post-puberty discovery – for experimentation – and for me it was exactly that. I learnt how to work hard and play harder. I learnt how to fall in love and mend a broken heart. I learnt about tax returns, lease agreements and life with bills. You know, the normal “stuff” we all have to figure out when we move out of home and find ourselves navigating adult-land for the very first time.

Among the uni all-nighters finishing off assignments and entering life as a full-time employee, I also became responsible for managing my money on my own, too. Each month my account would be filled with dollars I could only dream of when serving Sydney’s drunkest behind a bar and I was spending it as fast as I was earning it. My colleagues and I used to joke about not having any money left at the end of the month as we bought a new outfit on credit and headed out for the night (still can’t believe I did that)… every month.

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I made more mistakes than I can count in my 20s – especially when it came to money. So I’m going to expose them, as a gentle reminder of what not to do.

1. I didn’t have an emergency fund.

I argue that any “smart” money habits were simply laying dormant in my early 20s as a way of justifying my non-existent savings. And unfortunately this meant when I found myself in a money emergency, I just inserted one of many credit cards and ignored the bigger message. Seemed logical at the time!

2. I had a gazillion superannuation accounts.

Every time I started a new hospitality gig, I would sign away a new form and not give two hoots what it was for or how it would impact my future savings. I dread to think how much money I wasted in duplicate fees and insurance.

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3. I treated my tax return like a bonus.

When June 30 rolled around every year, you better believe that I was counting down the days until my tax return hit my account. I always planned to put most of it towards my credit cards, but in reality I would end up spending it on some ridiculous new outfit, justifying the expense as a “treat yo-self” moment.

4. I bought a brand spanking new car 100 per cent on finance.

I like to think that I don’t have regrets, but this is one big, huge, fat mistake that I most certainly learnt from. Not only did I put myself in more debt, but I spent close to $9K on interest. Yep, interest. What an idiot.

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5. I had multiple credit cards.

Pretty self-explanatory and the only excuse I have is that idiot levels were at stratospheric heights. What 22-year-old has three credit cards?

6. I wrote budgets for fun.

I’m obsessed with planning at heart, so budgets were something of an art form. The problem was, I never actually followed them. They just lived in their pretty lifeless form on my computer.

7. I didn’t invest in anything.

Shares? What shares? That’s for old people or the super wealthy, right?

8. I bought things I couldn’t afford.

My social life was quite busy. Very busy. Most weekends involved a new outfit and about 46,783 espresso martinis across 5 different bars and 7 different taxis. My wardrobe was growing faster than my poor loft bedroom could accommodate, but damn it was pretty.

9. I created habits I needed to break.

Impulsive purchases, living month-to-month and mortgaging the future for the sake of short-term addictions. Having $50 left the week before pay day was “normal”. Having a wardrobe where more than 30 per cent of the items still had the tag on was…also normal. And choosing to ignore my financial future was not just normal but also incredibly ignorant.

I had champagne taste on a beer budget.

But what I learnt in my 20s has luckily kicked me into gear in my 30s. And I won’t make the same mistakes again.

This post originally appeared on Fearless Female Traders and has been republished with full permission. 

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