There is so much I wish I knew about finances in my early twenties. If I could go back to my early twenties, I would look myself in the mirror and say one word: Save! Save ALL your money—or at least as much as you can. Make a savings. Build your bank account. Stop over-shopping or stop eating out so much. It’s true, that we may not realize our own spending habits when we are young and feel invincible. However, if I could go back to my early twenties I would make a variety of finance decisions differently!

If you are in your early twenties, mid-twenties, or just a person struggling to figure out how to be smart with their finances then this is for you.

Everything from a simple savings account to having a 401k can make all the difference. For anyone struggling financially, we often look back and think 10 years have passed and I could have had all this money saved or in my retirement accounts, had I made smarter decisions. It’s easy to dwell on it, but don’t do that to yourself. What I will do is teach you what I have learned in my nearly 10 years of being a twenty-something and how I have managed my finances.

In my early twenties, I often lived paycheck to paycheck, still lived with my parents, and struggled to build any kind of savings whatsoever. My parents constantly ridiculed me. I spent my days working, and then going out with friends, to dinner, to get drinks, and to movies. I acted as if I had all the money in the world to spend, when in reality I did not. 

This type of reckless spending was harmful and I knew it. Had an emergency come up, I would have been screwed. Low and behold, a few small emergencies did come up, and I’m sad to admit that my parents helped me and saved the day. What’s important to note is I wasn’t learning anything by depending on them when I had a financial crisis of any sort. I really wish I knew more about finances in my early twenties.

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Here’s how you can help yourself get to financial freedom:

Open a savings account and stay committed.

It’s easy to open a savings account and say that you’ll commit to putting away a certain amount each paycheck. But to actually do it is a whole other story. If you have good self discipline then I suggest using a normal savings account to save money. If you need help to keep the money in your savings without being tempted to pull out money whenever you feel like, then open a more structured savings account where it can’t be easily accessible to pull out money.

Maybe you’re in a job where you make minimum wage, and thinking “I barely make anything, how I am supposed to put anything away?” But, I am here to tell you that a little goes a long way.

Even putting just five dollars away each paycheck is a good start. In twelve months that will be roughly $120. Sounds like nothing? Well that was $120 more than had you not saved anything at all. Start off small and then slowly build up what you put away.

Getting a good amount back around tax time? Put that money in your savings account. That stimulus check, put it in your savings! Spare change laying around or gift money can all be put into your savings. I realized the more ways I could actively save meant more for my finances in my early twenties.

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Open different types of savings for specific reasons to also stay more structured. With my bank, I can open up to 8 savings account on my main checking account and I can nickname them as well.

Here are examples of some savings accounts you can create/nickname for yourself:

  • Emergency fund
  • Europe trip
  • Pay off car
  • Pay off credit cards
  • Wedding day
  • Baby/kids savings
  • Mutual savings (for you and your partner)
  • Splurge on myself fund(I would say this is ok only if you are financially responsible)
  • Savings for maintenance services(IE car maintenance, home maintenance, etc.)

Be smart with credit cards and building your credit.

While it’s good to build up your credit, be careful not to open too many credit cards. It can be so temping to open several credit cards when you hear things like no interest for the first 12 months or when they have a lower interest rate. However, if you are not financially responsible and are not fully educated on how to use them in a beneficial way, then only have open the lines of credit that you absolutely need! 

If you can manage to open credit card accounts and can use them without racking up too much debt then use them on your normal purchases.

For example, for me personally, the Costco Visa credit card through Citi Bank is great to use for every day things. You get a certain percentage back on things from gas, to groceries, to eating out, and travel. It is is crucial to make sure that as soon as you charge something to the credit card of your choice, that you pay it off right away so that you do not accumulate interest and so you don’t go into debt over time.

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Start a 401K/Retirement fund

On this, I will say do it from the start. If you have a job that offers a 401k or retirement fund of any sort then start putting money away. Your investment planner in your retirement fund account where show you where you will be at when you retire. If you are not sure how to navigate, most employers have someone who can answer your questions or you can ask an expert on your retirement account. If you have a family member or friend that is knowledgeable on this, don’t be afraid to ask for their advice.

I wish someone had told me about this when I was considering my finances in my early twenties. Whether your financial goals are big or small, strive for financial freedom always.

Financial freedom can simply mean that you are not living paycheck to paycheck, that you have a retirement fund that is being built, and that you have saving(s) accounts set up. Don’t be afraid to ask for help on how to get your finances in order and if you need more advice check out the many finance articles on  GenTwenty from our experts. Remember, no amount is too small to start saving and building up for your future. Be smart with your money and you will be so much more successful financially.