10 Important Financial Lessons To Learn While You’re Young {Series}

I follow a bunch of personal finance blogs and I am so glad that I do. I have learned a ton from reading them and it has been extremely helpful in making the transition from college life to “real life”.

I think one of the biggest hurdles I’ve had to jump in the process of “becoming a real adult” is the financial hurdle. Our finances are very different now than they were three years ago while we were still in college (for starters, they are “our” finances now). So I thought I would share ten of the important financial lessons that I’ve learned from my “real adult life” crash course.

There’s actually a lot here so I’ve decided to implement “Finance Fridays” for a while to get into the details. Below is a quick summary of the main points and each Friday I’ll expand on one lesson a bit more in a separate post. So come back Friday to see the details! (And if finances bore you, don’t worry…I’ll keep posting non-finance things on Mondays!)

1. Learn how to do your taxes
Everybody’s got to pay taxes (well, pretty much everybody) and if you’re lucky enough to have a job right out of college you need to know what you’re doing

2. Learn to use credit wisely and responsibly
Credit cards are powerful but dangerous things. Learn to use them properly and build up a good credit score so that you’re set in the future when you want to buy a house or take out a loan.

3. Track your spending
Make sure you know where your money is going (it can be quite different from what you think!)

4. Create a budget
A corollary to the previous lesson… Along with tracking your spending, make sure you track your income as well. This way you don’t have to worry about money because you already know what’s coming in and where it’s going.

5. Learn to pay yourself first
This one is mostly about learning to prioritize. You don’t want to have to sacrifice your savings in order to make ends meet, so learn to live on less so that you can sock some money away in your savings (it can be easier than you think!)

6. Learn about health insurance, and get some!
Health care expenses can be HUGE and often come out of the blue. Insurance can help you be prepared, so that if something happens you aren’t financially devastated.

7. Start saving now for retirement
The sooner you start the easier it’s going to be. Compound interest is your friend here, but it’s not a magical fantasy solution that will solve all your retirement problems. You still have to make contributions to your account every month to keep that balance growing.

8. Take advantage of company benefits
For those of you with a job that includes a benefits package, count yourselves lucky! Company benefits can include tons of different things (paid time off for the win!!!) but make sure you know what your benefits are and take advantage of them. This could possibly help with Lessons 6 and 7!

9. Set up an emergency fund
Sh*t happens. It just does. And you can’t plan for it. It’s the Type A’s worst nightmare! But having an emergency fund set aside can help you get through some of the uncertainty and financial strain of the unexpected.

10. Learn to think about the future
This one is sort of a summary of the whole thing. You can make small changes now that will be hugely beneficial to you later. Planning for the future no longer means “Make sure you wake up in time to get to class tomorrow.” You’ve got to look a little further ahead than that. 🙂

Do you have any other lessons you learned when you were young (or wish you had learned when you were young!)? I’d love to hear what you think!

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Jessi Wohlwend

I believe that anyone can do crafts and DIY projects, regardless of skill or experience. I love sharing simple craft ideas, step by step DIY project tutorials, cleaning hacks, and other tips and tricks all with one goal in mind: giving you the tools you need to “do it yourself”, complete fun projects, and make awesome things!

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  1. Jessi says

    9 years ago

    So true Matt! I'm using a Roth right now because of the long term advantages (yay Type A) but you're right about the immediate tax advantages for traditional IRAs. I'll make an effort to cover a little bit of the tax-related pieces when I go into the details later because it definitely is important to be informed, whichever way you choose. 🙂

  2. Matt says

    9 years ago

    I'd like to combine 1, 5 and 7 to create #11. While the most important thing about saving for retirement is that you start saving, you should also have an eye for the tax laws and how they relate to different retirement savings strategies.

    While just starting out, there are few things greater than contributing to an IRA and watching your tax refund go through the roof. Roth IRAs are nowhere near that much fun. On the other hand, the long term tax advantages of a Roth are unmatched by…pretty much anything.

    That being said, you've got some great advice in here! Keep it up. 🙂

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