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Planning for what happens to your money is one of the most sensible things you could ever do.

We all make financial mistakes at some point in our lives but none more so than when we are in our 20’s.

When you are in your 20’s everything and anything seems possible. The world is your oyster!

Most of us in our 20’s didn’t ever think about the distant future. If you did then you are definitely in the minority.

When I was in my 20’s the only thing that I thought about was short term cash and how I could get it.

My thinking was very much reliant on how I could make it to the end of the month and be able to buy all the “stuff” that I wanted.

That for me was success.

I didn’t think very far into the financial future and it showed in how I spent my money.

Even having a budget was not on my radar because those were for people that were broke (or so I thought)

If you have children or are in your 20’s yourself then you will want to run away from some of the financial mistakes that I made when I was younger.


Money mistake we make in our 20's


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Let’s take a look at 5 financial mistakes you need to avoid in your 20’s


1. Student loan

You think that having a student loan means financial freedom. I know that may sound like a bit of an insult but honestly, I just want to shock you out of your current thinking.

Most of my debt was accumulated when I was in my 20’s and no respect for money.

Your student loan is meant to be for books and other costs related to your school tuition.

Your student loan should not pay for new clothes or a car (yes I bought a car with my student loan)

Before you jump on the student loan bandwagon, think about if you really need it or not. Can you manage without it?

If you feel that you can’t then make sure you use it for its intended purpose at least OR use it wisely.

Personally, if I could rewind time then I would take the money and invest it in something that would yield me a return in some way.

This might be too risky for you so if you are not sure then I would avoid it until I was able to do enough research.

You must feel confident enough before you make any investment decisions.


Avoiding student loan debt


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2. Paying the minimum on a credit card

Yes, I’ve been guilty of this one too.

If you have a credit card then you must know how you are going to use it.

I can’t even remember what I used my credit card for that’s how important my purchases were. I definitely remember having to pay it off though.

Credit cards are like free money to some 20 something-year-olds and I can see why.

Credit cards are sometimes presented in a way that seems like the answer to all your problems but really they are not.

Credit cards give you a short time financial buffer and after that, you have to pay it back otherwise your debt begins to snowball.

Snowballing debt is one of the most dangerous things you will have to tackle. Stay as far away from snowballing debt as you can.

Paying the minimum amount on a credit card basically means that is the least amount that you can pay without incurring any penalty or charges.

The problem with paying back on the minimum on a credit card is that you will be subject to paying back often astronomical fees in interest in the end.

By simply paying back even a little bit extra on top of the minimum fee you could end up saving yourself thousands of dollars each month.

A study was carried about by Nerd wallet in regards to the true cost of credit card debt. You can take a look at it here.


Remember this financial mistakes post by pinning it to your favourite Pinterest board!


The top financial mistakes you will probably make as a millennial and how you can avoid getting yourself in to debt with money at such a young age.


3. Not having a budget

I have to repeat this time and time again because it is so important that you must have a budget in order for your money to work for you.

Without a budget, you can’t see where your money is going or how you are spending it.

Having a budget is is the most important thing that we did in our family to improve our finances. All the financial devastation I left behind me in my 20’s really could have been avoided with a simple budget.

Budgets are not just for those that don’t have money. Budgets are for everyone.

The more you use your budget the more you will see how sexy your budget actually is. It will become a challenge to see your money come in and how best you will use it for the month.

Budgets help you to stay out of debt before you actually get there.

If you don’t already have a budget, it’s never too late to start, you can grab my free budget worksheet by filling in this form



4. Spending money on clothes

I’ll let you into a little secret today, clothes will always be there. Yep, that’s my little bit of wisdom for you today.

Clothes will always be there to buy and fashion will change ALL THE TIME. You can never keep up.

If you buy clothes just merely based on fashion by tomorrow you will be broke (maybe not quite by tomorrow but you get my drift)

If being trendy is import to you it would be better to invest in a few staple pieces of clothing that you can mix and match.

Owning 10 different pairs of jeans is pointless. Believe me, most people won’t even notice you wearing them. Buy 5 interchangeable tops to go with 2 pairs of jeans and you have yourself a winner.

Clothes are very much here today gone tomorrow so it would be unwise to invest huge amounts of money into it.

Most of the clothes that I bought in my 20’s are nowhere to been seen today and it’s not because they wouldn’t fit.

They were just horrible and I don’t dress like that anymore. There is no longevity in simply buying clothes to feel good.

If you are an avid cloths buyer then perhaps consider charity shop purchases or cutting down on the number of purchases you can make in a month.

If you know you are a bit of a shopaholic then you should give Ebates a try.

Ebates will offer you cashback on purchases that you make instore and online.  You simply download the Ebates app and each time you go shopping instore or shop online just go to their site or app and shop as usual.

Each time you shop and make a purchase you receive cashback for it.

At least this way you will save as you spend (just don’t go over the top)

Sign up with Ebates for free here 


Woman overspending money on clothes


5. Not saving

Believe it or not, being in your 20’s is the time that you are most likely to have disposable income.

Having disposable income just means having money coming in without having a whole lot of expenses to go with it.

For this reason, older people always like to give those in their 20’s financial advice to stop them from making financial mistakes that they had previously made.

If you make a commitment to saving in your 20’s not only will it instill good financial discipline in you but your 30 and even 40 year old self will thank you.

Saving is so important for so many reasons you really shouldn’t avoid it.

DIgit is the perfect way for you to save if you have trouble remembering or just don’t know where to start.

The clever thing about Digit is that it analyzes your spending and saves a little bit of money each day for you.

It’s completely automated so you don’t have to give it a second thought, simply set your savings goals and that’s it.  It won’t save huge amounts of cash unless it knows you can afford to put it away.

You can give it a try here free for 30 days.  It’s certainly worth a try that’s for sure!


If you are disciplined enough you can take part in the 52-week savings challenge for young adults to help you get started on saving up your first $1000. You can get get the free printable by filling in the form below.


Final thoughts on financial mistakes in your 20’s


Making some financial mistakes when we are young is ok as sometimes we get to learn valuable life lessons from them.

If you can avoid the 5 mistakes that I have listed above you are already doing a great job.

Being in your 20’s is a great time to create financial stability for yourself to benefit from in the future.

As long as you have your working budget in place you should be able to avoid potential pitfalls.

I would love to hear about any financial mistakes you made in your 20’s. Leave me a comment below.


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Financial mistakes


The top financial mistakes you will probably make as a millennial and how you can avoid getting yourself in to debt with money at such a young age.