The 20s age is a very important era in the life of an individual. It’s a period where you can make mistakes that would last you the rest of your life, and it’s also a period where certain life decisions you make can be the catalyst for huge success.
Below are seven huge money mistakes that you shouldn’t make when in your 20s
1. NOT KNOWING THE DIFFERENCE BETWEEN YOUR WANTS AND YOUR NEEDS
There are wants and there are needs; needs are necessities, while wants are desires. Not knowing the difference between both can make you make very bad financial decisions at this age. During your 20s, you should understand your needs and your wants and spend your money accordingly. 20s people tend to be more prone to spend on their wants rather than their needs, and this is a terrible financial decision to make.
2. LIVING ABOVE YOUR MEANS
This is another money mistake many 20s people are prone to. Not understanding what your wants and needs are would make you spend more on your wants, and this would make you live above your means. When you can’t live within your means then you are only setting your path for failure.
3. BORROWING MONEY FOR LUXURY ITEMS
Going into debts is another terrible money decision to make, but going into debts to cover for your luxury is one of the worst financial decisions you can ever make.
4. INABILITY TO PLAN
Planning your income is the best way to maximise your income. This would help you spend smartly, save smartly, invest smartly, make you live within your means and make you maximise your income.
5. BORROWING AND NOT PAYING BACK
Countless people in this age borrow money from friends and family without paying back. This is a terrible act and things like this would easily kill your relationship with people who matter to you. Learn not to enter meaningless debts, and try to pay if you do.
6. SHOPPING ON CREDIT
This is another money mistake a lot of 20s people make, females especially. Shopping on credit or with a credit card is not the right way to go. This could leave you with huge debts you didn’t bargain for. Try to shop with cash — this would make you live according to your financial plan.
7. NOT PREPARING FOR THE FUTURE
This is one financial mistake that could ruin your life when you are much older. Neglecting the future may leave you in ruins at that time; save, plan and invest for tomorrow.
The 20s age is a really important stage of your life. Avoid these money mistakes; learning the right financial habits would help you tremendously when you are much older.