Oh the money mistakes we make when we’re young… I saw a post like this on another site – it may have been Jana at Daily Money Shot (If not, I apologize to whomever I got the idea from!), and thought about all the crazy money mistakes I made in my 20s. So I decided to do my own post – after all, although many of us make the same mistakes over and over… some of us just make some stellar ones all by ourselves! So here’s my list of things you should definitely do in your 20s if you want to make your financial future as difficult as possible…
1. Get married young. I was 21 when I married (for the first time….). My husband was 20. Oh, and be sure to marry a guy with no stable job, and no real desire to work. Yes, this was a WONDERFUL decision for me. Probably the biggest mistake I made.
2. Open credit card accounts. Lots of them. Especially the department store ones that charge 28.8% interest. Then run them up buying stupid stuff like video game systems for your unemployed boyfriend/husband! Oh and be sure to maximize the (interest) damage by making minimum payments.
3. Move half way across the country because all your friends are. I moved out to Vancouver in 1992 (thankfully, right AFTER I finished my last college course) with no job, no prospects, and an unemployed boyfriend. Yeah, that was smart. Six months later we moved back to Manitoba.
4. Have BABIES! Oh yes, I had my first son at 24… the second 2 years later. This is especially important to do when a) your husband does not want to have them; b) you are barely making ends meet yourself, so adding a child to the mix will make it BETTER, c) you live more than 1500 miles aways from your closest family member. (Don’t get me wrong, I love my kids…. but it was a TERRIBLE decision to make at the time!)
5. Get divorced. This is a classic money “mistake” no matter when you do it. I mean, sometimes it is totally the right decision, but divorce can be expensive. Mine was cheap (we had nothing, we owned nothing, we split the debts), but I still became a single mom with 2 kids to support.
6. Wage a long, ugly custody fight. Oh yeah… this was the best. I mean, our divorce was cheap – about $750. The custody battle? THAT cost me over $11,000. (And dragged into my 30s, but that’s another post.)
7. Buy a new car. (And sell a perfectly reliable used one too). Yep – I had a little, paid for Nissan. Yes, it needed about $1,000 in repairs, but it got amazing gas mileage, and it was paid for… so I replaced it with a brand new Dodge Neon (sticker price was just over $13,000). The Neon was a good car, but it was not a smart money move.
8. Cash in my retirement accounts. This is a bad move anytime too, but especially in your 20s when if you leave the money alone, it will grow, and grow, and grow…. But I had a custody battle to pay for, and so I cashed them in.
9. Graduate with a (mostly) useless degree. Theoretical math, anyone? I mean, I can prove that 1=2, which makes a nice trick at a cocktail party… but unless I wanted to get my Ph.D. (which I did NOT), or teach (another big NO THANK YOU), there are not a lot of jobs available. Aside from which, I graduated in 1992, which was during a lovely little recession, and top that off with… I graduated on academic probabation. Because partying through your entire final year is SUCH a good idea. I will say though – that degree was the only reason I was able to finish my accounting degree or get into the MBA program later in life, so I was glad I had it in the end. But I could have saved myself a LOT of time and money if I had studied something useful in school.
10. All the others…
And there were more, but most of the rest of them were smaller mistakes that just compounded the bigger ones I had already made. Or the ones I was about to make in my 30s!
I will say this – for all the mistakes I made, the one thing I did not do was borrow a huge amount of money to go to college. So I managed to escape THAT particular mistake!