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Why you should grind and work hard in your twenties
Why it is more important than ever to work hard and save
Most people view their twenties as the time to kick back, party, and have fun before you settle down in your thirties with a family. Although it is super important to enjoy your twenties, I argue that you can't enjoy your thirties, have kids, and get married unless you have some form of career and financial stability, which is usually acquired in your twenties. I don't mean to be a negative Nancy, but life does not get any easier, and you have to work hard if you want to make a lot of money and enjoy a good life. While dropping $500 on new outfits or at the club on a Friday night may be attractive momentarily, that money has more use in your savings account, RSP, or used to pay off student debt. Yes, it is important to travel and experience life, but it is also essential to achieve financial security and pay off debt. We all want to achieve the good life, but the good life won't be handed to you if you spend your twenties in an alcohol or drug induced haze, nor will it be acquired by avoiding reality and responsibilities. This article is meant to help my fellow millennials rationalize their financial and life choices, while keeping the future in mind.
How to be financially smart
Being financially stable is crucial and integral to ensure independence and happiness. I know money does not buy happiness, but neither does being in debt. Here are some ways you can spend and save intelligently.
- Avoid unnecessary debt
The only debt you should realistically have in your twenties is for your education, car, or home (if you rent or own one). It is completely unneeded to be in debt for Uber charges, clothing expenses, vacations you couldn't possibly afford on your own, or eating out. I am aware how hard it is to say no in the face of temptation, but I am also aware of how much it sucks to be $2,000 in debt because you couldn't go without a Louis Vuitton bag, or because you eat out at the Keg 2x a week. Frivolous expenses such as these will hurt your credit and inhibit you from saving for the future and paying off your student debt.
- Spend within your means
Not everyone was born into wealth and as much as it may suck, you may not have as much money as your friends. A lot of people make the mistake of spending more than they make, which results in unnecessary debt, that causes increased stressed on finances. It is important to be honest with yourself and what you can and cannot afford. You should not look at this as a personal shortcoming, but instead as a limit you must stay within. Being frugal with your finances while you are in your twenties will pay off immensely in later years since you will be unburdened by frivolous spending of the past. Who cares if you can't afford designer bags and clothing while your friends can? Your money looks better in your pocket than on an impulse purchase that will eventually go out of style.
- Try to finish all of your education before you are 25.
School is not a time to be glamorous and live a high lifestyle. It is a grimy time where you grind it out and live frugally. Although school is expensive, it is best to get it out of the way as quickly as possible so you can spend the rest of your twenties working and paying off debt before you solidify yourself in a stable career, relationship, and lifestyle. Going back to school as a mature student is not always a walk in the park and can turn out to be a huge burden later in life. Avoid the sting of regret and finish as quickly as you can.
- Save as much money as you can
If you are like me and live with your parents, try to save 80% of your income and spend the rest on the essentials. However, for those who live alone this can be difficult since you have to pay rent and bills. If you are living alone and paying your own way, try to save between 25-50% if possible. For students it is extremely hard to save money and I understand this, but if you have graduated and are working full time, I think this goal is definitely manageable.
- Start a Retirement Savings Plan
Okay, I know what you are thinking "I'm only 23 I'm not thinking of retiring yet." Putting aside $100 a month is a small price and can go a long way. The earlier you begin your RSP the more money you will have when you retire. In addition to this, by having a lot of money in your RSP you avoid issues that could occur with your pension and avoid the prospect of working through retirement instead of kicking back in Florida with Ethel and Gladice.
- Try not to eat out more than necessary.
Making food at home is obviously cheaper than going out for dinner constantly and buying a bottle of wine. Instead of going out, encourage your friends to rendezvous at your place and have everyone to pitch on ingredients and wine. You will spend half the money and get more bang for your buck. The money you save by eating in can be distributed to pay off debt, buy the essentials, or contribute to your savings.
- Shop smart
If you are shopping on a budget and want to be stylish without the heavy price tag, there are plenty of places you can buy clothing that looks expensive without denting your pocket. Zara and 8th and Main (221 Yonge St. Toronto) are some stores that are reasonably priced and have great clothing. Also, if you want to splurge and treat yourself to a designer bag try https://www.trendlee.com/. Trendlee sells used designer handbags for half the price, and oftentimes these bags are in perfect condition.
- Don`t be afraid to treat yourself.
I`m aware I just went all preacher on you and I sound like a no-fun stickler. However, I do believe in treating yourself, I do it all the time.... like I shop a lot. But, I only shop when I know I am in a good financial footing and can afford it. So, if you have been super good with your money and have some cash in the bank, TREAT YOURSELF. GO ON VACATION. GO OUT FOR A $200 DINNER. BUY AN OUTFIT. But only do so in moderation, only do so if you are relatively financially stable, or if you have been grinding it out.
I hope this article helps everyone in a similar situation to me. Have a great week and don`t forget to share and follow. :)