7 Worst Money Mistakes to Avoid in Your 20s

Understanding our mistakes is the key to eventually living the best versions of our lives. In the past few years, I have learned a lot about money and personal finance. I wanted to share with you my worst money mistakes today to hopefully help you avoid them. 

1. Contents

   Not Valuing My Time for a Fair Price 

When I worked my first, second, and third full-time jobs, I couldn’t even dream about anything above the average salary that people in my professional circle were making. 

My attitude toward money was limited by the glass ceiling of the corporate jobs I had at that time. I had a pretty good pace of career growth and it felt like I was really achieving some new goals but the problem was, I spent too many years chasing small improvements within a system that is limited by default. This was my life: getting into the office early, staying late, and even coming in on weekends — then maybe, just maybe, I could hope for a raise one day.

I did it instead of focusing my mind on something that could REALLY change my financial situation – instead of using all my free time on building my own business. 

When you are working for someone, you trade your time for money. Whether you’re paid $15 or $150 per hour, your income is still limited by the number of hours you can put in.

I had a few attempts to create my own blog or website on a side but I was wholeheartedly devoted to my corporate career growth because, at that time, I still didn’t realize that I was trading my time for money. Of course, those first blogs failed. Maybe I learned a few lessons from the failures but the biggest issue was a lack of mental focus on my OWN business.

Funny enough, the only thing that helped me take my online business seriously was taking a job where I felt REALLY uncomfortable. A very stressful job with not much growth potential. The moment I started that job, I knew that I HAD to make my online business and my blog work as soon as possible. 

Now, you can argue that I still trade my time for money even when I work on my blog, I have to put in a lot of working hours. 

Yes, you have to do it but the difference here is that as a business owner, you have an option to grow your income by using passive income streams as much as possible, by hiring help, automating processes, and removing yourself from the daily routine and anything that can be outsourced in your business. So, essentially if you approach business the right way, you will put in more effort and hours initially but over time, you can choose to work fewer hours while still growing your income. 

If you want to start an online business, I actually have a great video that will help you get started with all the steps for beginners. Check the link up there and in the description below. 

2. Having Only One Source Of Income

My second biggest money mistake was having only one source of income – it was my day job at that time. As I mentioned, I was working extra hours to get a raise and barely left myself the time to build any side hustles. 

I don’t know if you are old enough to remember the economical crisis of 2008 but I was at that time in a very scary position. Luckily, I wasn’t affected but some of my colleagues were laid off from one day to another, without doing anything wrong or being warned about it in advance. 

The companies were trying to survive and cut their expenses. But these people who lost jobs had nowhere to go because all businesses were cutting expenses at the same time. 

Some of these colleagues had families and kids to feed, and loans to pay, it was a disaster. It was so scary to witness that I learned that year how unstable even the most stable corporate jobs can be all of a sudden. And how important it is to have some kind of side hustle or build several income streams.

And when I started building my own online business, the first way I started making money with my blog was through display advertising. But I also worked hard on growing my affiliate income stream, and in my second year of blogging, I also started selling my first online course. To diversify my income streams, even more, I started this Youtube channel in addition to my blogs. And this channel became my second biggest income-generating platform after my own blogs. 

By the way, if you’d like to learn more about all my different income streams, you could check some of my income reports, for example, this one for the month when I made about $40,000. 

I will give you a link up here and in the description below. 

3. Knowing Nothing About Investing

My next huge money mistake is not taking the time to learn about investing. For many of you guys watching this video, it could be shocking but I had no interest whatsoever in investing until my age about 35-36. It’s never late to start investing but now I know that if you start when you are young, it allows the process of compounding to work to your advantage. 

Compound interest is where you reinvest the money you’ve earned from your investments, back into your investments. This creates a snowball effect with your money so it picks up speed as it grows.

The amount that you invest will grow substantially over time as you earn interest and receive dividends, and as share values appreciate. The longer your money is at work, the wealthier you can be in the future and at the lowest possible cost to you.

And the next huge mistake you might have done is not clicking on these buttons below 🙂 Subscribe, Bell and like this video, if you want to learn more about making money online. By the way, if you have any questions you’d like to ask me, the best place is in the comments below the video 🙂 

4. Ignoring Cryptocurrencies Until 2021

I heard about cryptocurrencies in 2017 and even before that, but I ignored the hype and I thought it was too risky. I felt that there was potential and that probably it was the most logical way for money to develop. After all, everything was going digital, why would it be different for money. I just didn’t take it seriously and didn’t realize how I’d regret it about 5 years later. 

But when I’ve seen the spikes of cryptocurrencies in 2021 I decided to really invest my time and effort into learning and understanding more about this market. 

If you are not sure where to start, I can tell you that even here on Youtube you can find a ton of very helpful information about cryptocurrencies. As for me, I am not only holding several respectable coins (or how they say it in the crypto world, hodling) but I am also using crypto bot trading to grow my investments in crypto even during the periods when the market is more or less stagnant. 

This is a very passive income stream based on price fluctuations which are very typical for the crypto market. I invested about USD 3000 in these 3 coins about 3 months ago and this bot made about 30% profit in total from these 3 coins. Now if you know something about investing in the stock market or in anything else, tell me where you could get a 30% profit in 3 months.  

Crypto can be quite a risky investment if you want to put in a 1000 USD and hope to get double a week later. You may get lucky and this can happen on the crypto market. But you can also lose about the same amount in dollars in just a week. However, if you don’t sell your crypto during the dip and hodl it until the next spike in price, you won’t lose anything. 

Getting back to the crypto bots, I don’t think it makes sense to go into much detail about how they work. I can only tell you here that you might want to check here my post about Dan Hollings The Plan review of his crypto trading program. And what I can suggest is if you are interested in learning more on this topic, sign up for my email list here. Then I’ll send you more information about these crypto bots. 

5. Saving Money in The Bank Instead of Investing

My next mistake is to keep almost all the money I had in a savings account, not investing the money but thinking that the money was safe in a bank. 

Until the last few years when we all felt enormous and fast inflation, it never crossed my mind that by keeping money in a savings account I’m essentially losing money. Interest rates that banks can offer are ridiculous and always many times lower than the inflation rate. 

So if you get 1% in annual interest on your savings, and inflation is 7.5% like it is in 2022 in the US (probably in reality it’s higher but these are the official numbers), you are technically losing 6.5% of your money in a year. 

I’m not saying that we should all invest everything and clean up our savings accounts. Of course, everyone needs to have a certain amount of cash available in an emergency fund. Someone would feel comfortable knowing they have at least 6 months worth of their monthly expenses in a savings account. Personally, I am more conservative and I feel better knowing I have enough savings for my family to live for about a year. 

But anything above that I think it’s not wise to keep it in a bank unless you are ok with the fact that your money is losing value every year because of inflation.

6. Being Frugal Where It’s Not Worth It 

Here we are talking about a mistake that many business owners make. You think that you are being smart when you do thorough market research and choose what seems to be the most cost-efficient option. When I started my online business, I was often buying cheaper software but eventually, it didn’t work well, these companies couldn’t provide great customer support and took a lot more time to fix the issues. 

So I might have saved 10 or 20 dollars a month on cheaper software but I potentially could have lost a lot of clients because some automations didn’t work properly and leads couldn’t even complete the entire sales funnel. Plus, I lost hours upon hours of my own time trying to fix technical issues when I could have spent this time making more money if everything worked as it should. 

7. Not Taking the Time to Learn About Money

The mother of all my mistakes, the biggest of them all was not taking the time to learn about personal finances. I could have avoided many of these mistakes mentioned today if I paid attention to my personal finances and educated myself in this area. 

Yes, it’s true that no one is teaching us in schools about personal finance but we live in 21 century and all information we might need is available online in so many different formats – from blogs, eBooks to so many Youtube channels dedicated to this topic. 

We rarely take the time to actually learn about managing money… obviously, it’s way more fun to watch some new series on Netflix, I get it! But if you don’t invest your time into self-education about money, then I’m afraid it’s hard for you to significantly improve your financial situation. 

If you want to learn more about money management, I will leave you my video with my favorite budgeting hacks that I’m using this year and a couple of other videos that will help you make money online. Check them out here and there and I’ll see you in the next videos! 

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