10 Things I Did in My 20s That Made It So I Never Worried About Money Again Because of some key decisions and habits I developed in my 20s, I have never been worried about money.
By John Rampton Edited by Mark Klekas
Opinions expressed by Entrepreneur contributors are their own.
Your 20s are considered a time of exploration, trial and error and self-discovery. However, it is also an ideal time to build the foundation for a lifetime of financial stability. As a result of some key decisions and habits I developed in my 20s, I have never had to worry about money.
So, let me share what I did in my 20s to avoid worrying about money again. Hopefully, these tips will help you do the same.
1. Invested in myself through education and skills
Building a strong foundation of skills and knowledge was my first priority. Although I completed a degree, I also took online courses, attended workshops and read voraciously. I focused on skills in demand, such as digital marketing, coding and investing. Additionally, I was able to diversify my income streams by starting side hustles.
Takeaway. You should invest in learning marketable and evergreen skills. You can boost your earning potential with platforms like Coursera, Udemy and LinkedIn Learning.
Related: How I Taught Myself Financial Literacy — and How You Can, Too
2. Lived below my means
Living well below my means was one of the most significant things I did. In contrast to my friends, I chose thrift stores and shared apartments over designer clothes and fancy apartments. Rather than eating out, I cooked at home and questioned every purchase: "Do I really need this?" Sometimes, friends would say, "Man, you are being a cheap a**...," when I didn't want to go in on a bunch of fancy food feasts every week or pizza and treats every night. You have to learn to be okay with what's said about you.
As a result of this approach, I was able to save a significant portion of my income and avoid debt. By the time I was in my late twenties, I had an emergency fund and enough savings to start investing in my businesses.
Takeaway. It's never too early to adopt a frugal mindset. You can save and invest more when you spend less, which pays off in the long run.
3. Started investing early
I didn't wait until I had a high income to begin investing. When I had even a little spare cash, I opened a retirement account and started contributing. In addition to graduating from university, I educated myself about index funds, real estate and other investment vehicles. Thanks to compound interest, even the minimal contributions in my 20s grew significantly over time.
Takeaway. The sooner you invest, the more time your money has to grow. Also, consider low-cost index funds and employer-matched retirement accounts, if available.
4. Built multiple income streams
Having only one source of income seemed risky to me, so I diversified. Along with my full-time job, I freelanced and side-gigged and eventually began a blog that generated passive income. Additionally, I laid the foundation for two successful companies, Calendar and Due. With each additional income stream, I could save and invest more quickly.
Takeaway. Identify ways to generate income in addition to what you currently earn. Diversification is key whether you want to start a freelance business, invest in rental properties, or start an online business.
Related: 11 Side Hustles That Take Less Than An Hour Per Day
5. Mastered budgeting and tracking
In my early 20s, I created a budget and adhered to it religiously. I used budgeting apps like YNAB (You Need a Budget) to track spending and ensure I saved money. Having a clear picture of my money helped me make informed decisions and avoid financial stress. Though I don't have money issues now, I'll always be careful with money — I know where my money goes.
Takeaway. There's nothing restrictive about a budget; it's actually empowering. You can track your finances and make necessary adjustments using tools and apps.
6. Avoided bad debt
Regarding debt, I was careful about what I took on. Even though I had student loans, I paid them off quickly and kept them manageable. To avoid credit card debt altogether, I paid off my balance each month in full. For non-essential items, such as tools, I would borrow or rent instead of buying.
Takeaway. Debt is not always bad, but it should be managed wisely. Avoid high-interest debt and pay off what you owe as soon as possible.
Related: 3 Ways to Conquer Your Debt and Stay on Top of Your Financial Game
7. Surrounded myself with financially savvy people
Your habits can be significantly influenced by the people you spend time with. As such, by surrounding myself with financially responsible and goal-oriented friends and mentors, I was able to achieve my financial goals. Their advice and support were invaluable, and their mindset shaped my own.
Takeaway. Spend more time with financially savvy friends, family members, mentors and communities. As a result of their influence, you will be able to stay focused and learn new strategies.
8. Embraced the power of automation
To simplify my financial life, I automated as much as possible. I set up automatic savings, investments and bill payments. As a result, I never missed a payment and had no temptation to spend the money I intended to save.
Takeaway. Don't underestimate the power of automation. Set up automatic transfers to savings and investment accounts to build wealth effortlessly. You can also open an account with a robo-advisor, where you will answer questions about your financial situation and goals and receive investment advice. When the account is set up, the investments will be fully automated, and adjustments will be made as needed.
9. Focused on health and well-being
Although it may not seem directly related to finances, taking care of my health saved me money. By exercising regularly, eating healthily, and receiving regular checkups, I avoided medical bills that could have been costly. Furthermore, being healthy helped me focus on my goals and allowed me to be more productive.
Takeaway. Make health a priority. In the long run, it will help you avoid financial stress and you'll rarely get sick.
Related: Health Is Wealth: How to Move Away From Hustle Culture
10. Stayed curious and adaptable
As the world changes, so do financial opportunities. My curiosity has kept me informed about new trends, technologies, and investment options. By staying adaptable, I was able to seize opportunities that others might have missed.
Takeaway. Don't stop learning. Be open to new ideas and ready to adapt your strategies as necessary.
Final Thoughts
You won't reach financial independence overnight, but your habits and decisions in your 20s can prepare you for it. Investing in yourself, living below your means, and making smart financial choices will enable you to live a life without stress related to money. Your future self will thank you if you start today.
