What we wish our 20-year-old selves had known about money

If we could reach back and give our past selves some advice, this would be it — from pensions to paperwork...

Now, perhaps more so than ever, we’re living in the moment. Why shouldn’t we? Lockdown is lifting, and we’re finally getting back to living our lives. But sometimes, especially when it comes to money, it pays to think about the future. God knows we’ve got some firm, stern advice we wish we could give our past selves…

Can you imagine how much easier things would be? If we had a penny for every time we wished we could sit down with our younger selves and impart some sage money management tips, we’d probably be millionaires. (To clarify: we’re not.) And, although we’re far from financial experts today, we thought it might pay to share our collective wisdom on certain fiscal matters. Who knows, twenty-somethings, you might learn from our mistakes…

Budget, budget, budget

#1 Monitor your weekly cashflow

We get it, your twenties are all about being young, wild and free (especially after the year we’ve had). But you really don’t want to splurge away everything you earn on spontaneous purchases and overpriced pints. Keep track of your outgoings (and you can thank us later). 

#2 Eat sensibly

You don’t need to go to Waitrose every time you’re cooking dinner. You really don’t. Bulk food shopping is your best friend, and big-batch cooking is your strongest monetary ally. 

#3 It’s the little things

Often, the greatest savings come from repeatedly reining in those small, everyday purchases. Do you really need to buy that film you’ve been dying to watch, if there’s the option to rent it? Do you really need a large coffee that you’ll only drink two thirds of, when you could get a small coffee you’ll drink all of? There are often cheaper options available, even if only marginally: and it all adds up.

The boring stuff won’t be boring for long...

#4 Pay attention to your pension now

We get it. Pensions are dull. But trust us: when you retire, you’ll be unbelievably glad that you took it seriously now.

#5 Do your research when it comes to ISAs

Don’t just get the first ISA you can find — because ‘everyone else has one’ — and then let it sit there empty. Do your research, and work out which one is most suitable for you. That way, it’ll make the most of your earnings, current situation and life goals. 

#6 There is nothing funny about overdrafts

If you’re in a position to avoid it, then you should seriously avoid it. Be aware of when you’re straying precariously close to your overdraft, and start budgeting immediately. No one needs any more unnecessary debt.

The big property question

#7 Be realistic about where you can afford to rent

We’d all love to graduate from uni and move straight to Kensington, or Fulham, or Notting Hill. But, if your budget is more suited to other, less expensive areas, make do. If you live outside your means, you might be living somewhere fabulous; but good thing too, because chances are you won’t be able to afford to do anything other than stay in. 

#8 Looking to buy? Start saving now

There’s so much talk about how millennials and Gen Zs won’t be able to buy until they’re about 85. But frittering your money away because ‘I’ll never be able to buy a house, anyway’ is the wrong attitude, gents. The more you save now, the closer you’ll get to that first set of keys. 

#9 Don’t neglect that credit score

It’s so easy to dismiss it as ‘something to worry about in the future’ — but the future will swoop around sooner than you think. The better your credit score, the greater your chances of securing a mortgage.

It's a friendship thing

#10 Live within your means; not the means of your friends

Some friends will always earn more than others, depending on which industry you’ve all chosen to go into. If your friends are earning more than you, try to resist keeping up with them in terms of eating out, holidays and all the other fun stuff. Live within your budget, not theirs. If they’re true friends, they won’t pressure you to spend money you don’t have. 

#11 Don’t be afraid of the ‘money conversation’

We’ve all been there: one friend says ‘shall we all go in on [this ridiculously expensive birthday present] for our pal?’ If you can’t afford it, say so. It doesn’t make you a bad friend, it makes you an honest one. And your friends should respect you for it. 

#12 If the reverse is true, try to be empathetic

Is there that one friend in your friendship group who isn’t on a competitive salary? Try to be mindful of that when suggesting things to do. You might be able to afford a three course meal and drinks at that brand new restaurant that’s just opened in Mayfair; but your friend might be more comfortable with one course and a pint in Soho.

Stay on top of it all

#13 Monitor that bank account regularly

We’ve all been there: terrified to check our accounts for fear of the gut-punchingly small amount we may find there. But if you check it regularly, then you’re much less likely to have ‘the fear’. Keep monitoring it on a regular basis: that way, you shouldn’t have any nasty surprises. 

#14 Pay those bills on time

If you’re able to pay your bills on time, then you should never pay them late. Settle everything promptly, and your mortgage broker will bestow an approving eye on you later. 

#15 Keep every shred of paperwork; and we mean every shred. 

Bills, P45s, letters from your bank, details of your pension scheme — keep it all. You never know when you might need it. You could even make a project out of it: get an oversize folder, splash out (the only time you’ll read that phrase in this article) on some plastic wallets, and maybe even some sub-dividers. Who said personal finance couldn’t be fun?

Seeking advice on money etiquette? Here’s a gentleman’s definitive guide to tipping

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