Hindsight is 20/20, especially when it comes to finance decisions we did or didn’t make. Knowing what I know now, I’ve compiled a list of some of the key finance decisions I wish I had made at 21. If I had started doing the items below at 21 my overall wealth and welbeing would have benefited greatly.
1. Learn how to create a finance budget
I still remember getting my first pay-check from the job I landed after graduating. Compared to the amount I’d been living off at University, it felt like a lotto jackpot.
I promptly spent it on a new mobile phone, video games, a few nights out, and rent. Within two weeks of receiving the money I was already broke, and counting down to my next payday.
This pattern continued for a few years, until I finally decided I wanted to have something left to show for my hard work each month.
Plan your monthly spending
Now I plan my monthly spending before I get paid and give myself a saving goal using the 50/30/20 rule. This helps give me focus, and I feel in control of what’s coming in and out of my account.
This helps me save for the things that I really enjoy (like going travelling), instead of blowing it all on lunches and beers! I’m now always looking for ways to reduce my monthly spend without impacting my daily life.
2. Invested in Mutual Funds
When I was younger I had heard of the Stock Market, but had no idea what it was.
Looking back, if I had been saving more and investing it into Mutual Funds I would have had a much larger deposit when it came to buying my flat in my late 20s.
As with any Stock Market investment Mutual Funds do carry risk, but in general they are the best option for first time investors.
My current Mutual Fund investments on average make 20% in compound interest each year. So If I had started at 21, I would have had considerably more today.
3. Started a Blog
Creating a blog is one of the most rewarding things I have done in recent years. It’s a fantastic way to learn a variety of new skills, and a constructive use of my spare time (instead of just watching TV!).
Maintaining a blog takes a lot of hard work and commitment. Blogging is definitely not a way of getting rich quick! But it can be a great way to earn some additional passive income.
4. Invested in personal development
Personal development and learning new skills is very important. However people neglect investing in these areas during younger life.
Many feel that once they have completed formal education there is no need to finance any more learning.
This however couldn’t be further from the truth. Investing in personal development not only gives you more marketable skills, but it can also build confidence. It’s an opportunity to highlight aspects of your self that need development and setting goals to improve them.
Every time I attend a new class, I always come back with new ideas and inspiration.