Money is probably the single most stressful thing in our lives. You work hard to get it, and then there never seems to be enough of it. This is especially true in your twenties, since that’s probably the first time we all get experience renting apartments on our own, keeping track of bills, and paying back student loans. Just out of college, it’s easy to make mistakes. Beyond that, there are certain financial truisms that we all know, buuuuuut kinda just ignore because “we’re young.” But eventually, you have to acknowledge the fact that there are some truths about money you can’t ignore as you hit the 25-year-old mark.
And it’s not like you don’t know, since literally everyone will try to give you money advice at some point.
Some money advice is complete BS. Some advice is totally true, but maybe not applicable at this point in your life. Like, how does one invest without a full-time job? But! As much as you want to roll your eyes at your parents about how to save and to stop spending so much money on eyeliner and avocado toast, they sort of have a point.
You should never stop treating yourself to eyeliner (or whatever your go-to reward is), but it’s so much more fun to spend your money on the things you love when you have your act together and know exactly what’s coming in and how it’s all going out. Trust us, we’ve been there.
These are some money truths you just can’t ignore by the time you’re in your mid-twenties.
1You need a budget.
2You have to get real about your credit cards.
If you’re living paycheck to paycheck, it is basically impossible to pay down debt. But at the same time, you’re likely using it to help you out now and again. Sometimes you don’t have a choice about using credit. But you should have some idea of what’s actually going on with your debt. Make a list of all of your cards, the sitting balance, and the interest rates. Then see if you can start using one card less or making payments on another. You don’t want to end up 30 years old with crushing credit card debt, especially since it is possible to help yourself!
3Same with your student loans.
If you have student loans, it’s easy to just assume that you’re never going to pay them off. It’s a lot of money! You might not be able to make regular payments right now, but you need to open the bills and check those emails and face the music. Call the provider and see what your options are so you can make a plan about handling them. Having a plan is better than the crushing anxiety you might feel.
4Pay attention to your pension plan.
If you work a job where they offer you a pension, take it. But then keep all the paperwork for when you move jobs, so you can make sure you’re getting all the money you paid into the plan. “There are a couple of cases where it’s more difficult to move pensions between schemes, particularly if the job you’re leaving offered a final salary pension scheme. In this case, it’s just important to keep your old company up to date with your latest contact details so they don’t lose track of you – and you don’t lose track of your pension,” Helen Saxon, chief product analyst at MoneySavingExpert.com told BuzzFeed.
5You should start an emergency fund.
If you don’t have a savings account yet, you should start one. You can automate transfers into it, so you don’t even have to think about it and can just watch it add up. If you need to pay bills and can’t afford to shove $50 or $100 per paycheck into a savings account, don’t feel like you’re losing. Keeping up on your business and avoiding late fees (especially on credit card bills, since it affects your credits score!) is more important. But start visualizing that savings account with a few months of cash money in it, just in case.
6Your wedding doesn’t have to cost millions.
Now’s the time you might be thinking about tying the knot and going all out for a wedding. The average cost of a wedding these days is $26,000. But get this: Weddings that cost over $20,000 are correlated with shorter marriages. If you’ve always wanted to spend that much money on something and are going for things like ice sculptures for your wedding, have fun! Enjoy the heck out of it. But think about what you might be saving by picking a venue like a public park that you don’t have to rent or using Honeyfund. There are ways to cut back and still go glam.
7You don’t need a house (unless you want one).
There are so many opinions about younger people buying avocado toast instead of houses. Buying property is a big deal. Know that you don’t need to jump to owning property, but if that’s something you see in your future, you can start checking out ways to do it that work for you now. Homes aren’t always an investment, so really think hard about your goals before you feel the pressure to get a two-car garage.
Taking control of your finances is crazy empowering, and really, it just takes a little bit of prep time to get everything in line, even if you’re not making tons of money just yet.