10 Personal Finance Tips for Girls in their 20s
1. Personal finance advice is PERSONAL. Take any advice you see online with a grain of salt, including this one. That being said, there is a lot of basic advice that could apply to a lot of people and do a lot of good.
2. Be interested about money. You’re being ignorant if you think that money doesn’t affect you, or that you don’t care about money. It is one of the most important areas of your life as a grown adult. You don’t have to think deeply about it every day–you just need to learn the basics and put some time into it at the beginning, and that will set you up better than most people. Read books. Read forums. Watch YouTube videos. Listen to podcasts.
3. Debt is complicated–think about it before you take it on. Think about whether or not it’s a good choice for you in your personal situation. Generally speaking, mortgages are acceptable debt, and consumer debt is not.
Student loans are a grey area, but don’t take it lightly! Make sure the cost is worth what you think you’ll be able to make with an income. Talk to people who are in your field and ask whether or not your level of student loans is worth it. Be educated about debt before taking it on, or else it will be a very ugly monster.
4. You Need a Budget (YNAB) is the best app for budgeting, period. I don’t want to hear anything about tracking your expenses, because that’s retroactive. We want to be proactive with our finances. YNAB lets you do that. There’s a year-long free trial for students too.
5. Credit cards aren’t the devil, but if you can’t use them responsibly, figure yourself out before you use them. The maximum amount of money you can borrow from your credit card (aka your credit limit) is NOT your money. It’s debt. If you can’t control yourself, then take a step back and reign in your spending habits before you get a credit card again. YNAB will help with this. I have access to over 6 figures in credit from the bank, but I’m not out here blowing that money on designer bags and whatever.
6. Your savings are wasted in a savings account at your bank. Big banks have the customers by brand name alone, so their interest rate will be measly compared to smaller banks. Be sure to do your research before you commit to a smaller bank because there can be some scammy ones! My bank’s interest rate on a savings account right now is 0.05%. My high interest savings account interest rate is 1.5%–x30 higher!!
7. Your significant other is a significant decision not only for your life but also your finances. Don’t rush into marriage. Don’t rush into buying a house together. Don’t rush. Divorce is painful and expensive. And being with someone whose financial values align with yours is important. You don’t want to be scrimping and saving when your partner is out buying everything under the sun.
8. You don’t know anyone else’s finances, so fighting to keep up with the Joneses is stupid. There are athletes making millions of dollars a year who have flashy lifestyles and can’t handle their finances and end up bankrupt. You don’t know how the girls on Instagram or the other rich people in your life are affording things, so you can’t compare your situations. You don’t know how much money they make, or how much money their parents give them, or how much student loans they have. Eyes on your own paper. Focus on your own financial security.
9. Reconsider how much you eat out. Eating out is such a money suck for many young people, either because of convenience or because you don’t know how to cook. Learn how to cook. Don’t be lazy. If you’re getting takeout, consider at least picking it up instead of getting it delivered and paying an abhorrent amount of extra charges in service fees, delivery fees, and tips. I’ve cut down my eating out significantly and my wallet thanks me for it.
10. You are in control of your money. (Side note: don’t give that control to anyone!!!) You CAN make good and responsible choices. You CAN achieve financial goals if you do your research and educate yourself and put in the work. You CAN reach a point where money is not a stressor in your life. I believe in you.
Now go out and get wealthy.
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