Things I wish I knew when I was in my 20’s
“This page contains affiliate links. If you choose to purchase after clicking a link, I may receive a commission at no extra cost to you.” I truly appreciate your support if you choose to buy through my links.
As we get older there are things we all wish our younger selves would have known. In short here is my take on what I wish I knew when I was younger. Specifically about financial intelligence.
The power of reading
Read, read, and keep reading. What helps is reading financial books and execution, which I’ll cover later. This is one of the most beneficial steps you can take to get the most amount of exposure with the lowest amount of risk. A lot of highly rated books you can find for free online and download to a pdf with a basic Google search. I however prefer physical books compared to the digital kind. Some of my favorite books can be found ( Here ) on my favorite books page. Books can serve as a base from which you build your foundational knowledge. By serving as educational resources, offering diverse perspectives, inspiring motivation, providing practical tips, supporting continuous learning, aiding in financial planning, and fostering risk management skills, books become indispensable allies on the path to financial freedom.
The Power of Early Investing
I would have liked someone to tell me to start investing as soon as I exited high school or even sooner. We all start from somewhere and usually most people I would have to assume start with nothing or maybe not a lot. A basic three-step ladder for early investing is as follows.
grow your savings - you have to pay yourself first. No less than 10% of your paycheck will go into your investing savings account. Yea yea I can hear it now, but Alex, saving is bad, and inflation and the economy and every other excuse. Ok, try investing with nothing and see how far that gets you. Anyways back at hand, you will have to open a savings account and just start putting money in. It’s simple and easy which means you are going to do it. Also, keep reading books. One of my absolute favorites and a good one to start with is The Richest Man in Babylon.
Earn a bit more - ok now that you have some money or this can be done from the beginning is to open a high yield saving account. This is exactly like a normal savings account usually online with no physical locations to walk into. But this will offer you a higher Annual percent yield when you store your money. Also, continue to read more books.
ROTH IRA - So you made it this far, the next step I wish I knew was to open a ROTH IRA as soon as possible. A Roth IRA allows you to control where you would like to invest your money. Your profits made through investing correctly are tax-free after a certain age or withdrawals up to the amount contributed. Generally, this is good for long-term investing. Additionally, the one other thing I’m adding to this section would be Indexes. Indexes are associated with stocks. The simplest definition of an “ Index “ is that it is a group of stocks that we’ll call a bundle and you’re purchasing the bundle as a separate item. What the bundle is, is an Index.
The Importance of Credit Health
Credit is a powerful tool that can open doors to opportunities, from homeownership to favorable interest rates. In my twenties, I had a good credit score but I would have liked to build it sooner and learn the finer points to maxime earlier as well. Understanding how credit works and the role it plays in shaping financial options is a lesson that, when learned early, can significantly impact financial freedom in the years to come. My beginner’s guide can be found ( Here ).
Take action
Taking decisive action is a cornerstone of financial success. Whether it's creating a budget, investing in the stock market, or paying down debt, proactive steps pave the way for financial well-being. Inaction can lead to missed opportunities and stagnant financial growth. By setting clear goals, staying informed, and making strategic decisions, individuals can harness the power of their finances to build wealth and achieve their aspirations. The key is to move beyond intention and convert financial knowledge into tangible actions that propel one toward a future of stability, security, and ultimately, financial freedom.
Acquire high-value skills
Acquiring high-value skills is an investment in personal and professional growth that pays dividends throughout a lifetime. Whether mastering coding languages, honing effective communication, developing leadership capabilities, or learning practical hands-on skills, high-value skills enhance versatility and adaptability. They not only open doors to career opportunities but also empower us to navigate an ever-evolving landscape with confidence. In the pursuit of these skills, the journey itself becomes a testament to resilience and a commitment to continuous learning, laying the groundwork for sustained success and fulfillment.
