I can’t really remember what got me thinking about this list of what I should have known better about my finances in my 20s. Maybe it was Corey’s list of 16 Ways To Improve Your Finances that make me think. Heaven knows that I have made a few financial mistakes along the way.
This list of what I should have known better about my finances in my 20s is an attempt to help others before they make some of the same mistakes. It is not too late though to recover from your errors though if you have made these listed below.
1. Don’t borrow from your 401k retirement plan. Even though you are paying yourself back with interest, you are going to be forever behind the retirement savings power curve.
2. Invest enough to get the employer matching contribution on your 401k Retirement Plan.
4. Your children don’t need any life insurance policies. You should have enough to bury them with your emergency fund.
5. Maxing out a Roth IRA is one the best things we can do. This should be your goal as soon as you are financially able after you start working.
6. Only suckers really think that they can time the stock market.
7. Index funds are not quite as boring as I originally thought.
8. Bonds definitely are boring investments.
9. Not all good debt is really actually good.
10. It is not always okay to go into debt for a college education especially if you have a less than marketable major.
11. It is okay to rent right after leaving home. You shouldn’t feel like you are in a rush to buy a house even if you are financially able.
12. Keeping up with the Jones is one of the worst mistakes you can make
13. Credit card debt will drown you for a very long time when you are just getting started. You may want to consider consolidating your debt from a bank such as Clydesdale Bank in order to get a lower interest rate, pay off your debt, and get back on the right track.
14. Life is so much easier without a car payment.
15. You need a fully funded emergency fund. Period! Far too many people do not have one in place and cannot get out of the rut of borrowing on credit cards because of it.
16. Mom and dad will not be there forever to help you.
17. You need to be careful who you trust for financial information. There are so many people out there giving out bad advice.
18. Start saving for your kids college educations as soon as you can. You can always transfer their 529 College Savings Plans if they do not go to school or get a scholarship.
19. Life is about doing things, not collecting things
20. There is an incredible sense of pride in doing it on your own but you shouldn’t hesitate to ask for help if you need it.
What do you think about my list? Did I forget any that you wish you had known or things that you we all should have known better in our 20s? Let me know in the comments…