10 Financial Musts Before Age 20

Is your ideal dream to retire at age 35? Would you like to eliminate your debt? Or do you just want to avoid the reality of living paycheck-to-paycheck that plagues about 75% of Americans? Whatever end game you desire requires discipline, hard work, and a bit of a financial education. These 10 financial musts before age 20 are designed to provide you with a tremendous foundation to achieve your financial goals.
The title implies that this article is intended for someone not yet in their 20’s, which is true, but these methods can and should be applied throughout life. The sooner you start though, the closer that financial freedom comes. It is my intention that implementing these 10 musts will help you develop good financial habits, eliminate debt, and increase savings so that no matter your dreams, they are achievable.
We will be posting 2 musts every Financially Fit Friday until the list is complete. So stay tuned, subscribe to the blog, and let us know your thoughts. Thanks for reading.


1) Find a way to earn an income and do it at an early age. You can’t do much of what’s below if this isn’t tackled first. Cut grass, shovel driveways, wait tables, bus for people who wait tables, start an internet business, sell something, have a big family and save all your birthday money… The how is irrelevant, just do it. Income and time are two of the most important things when thinking of finances and savings, and at this point in your life, you have better control over these than many of the rest of us. If you’re thinking that classes, sports, or activities with your friends may get in the way, understand that I’m not recommending a typical 9-5 (unless that is available to you and something you’re interested in). If you have some free time in the evenings, a summer off, or want to work weekends… again the how is irrelevant, make it happen.


Earning an income is important for many reasons. The most obvious of which is that after the first check comes in you now have more money than you did beforehand. Secondly, it can be quite a gratifying feeling to earn your first few dollars. There’s something supremely satisfying about solving a problem or completing a task for someone and receiving a reward. It helps you develop a sense of drive, of cause and effect (in a positive way), and maybe stirs a desire to find this feeling again? This income, no matter the quantity, also gives you an increased responsibility. It comes with choices and more consequences. Do you spend this money on wants or needs, save it, or use it to make more? No matter your decision, you learn to evaluate the pros and cons of these micro choices. Another benefit – going through this process will help you prepare for when these decisions take on a more macro scale.


You can also use this time to try different types of jobs or money-making schemes. You may not have a great number of responsibilities regarding family finances and that can be a tremendous advantage. Coming home with empty pockets or a business idea going belly-up carries far fewer consequences without a family to support or rent to pay, so try something. Enjoy sports? Work at a ballpark. Dance? try a studio. You get the idea. Try something you think you’d love to do. In trying different ‘careers’ at an early age, you can eliminate jobs you wouldn’t wish on your worst enemy or gain valuable experience and skills to build on for the future.


Sunset at Waikiki beach in Oahu, Hawaii. Not a bad place to earn an income, or reason to adopt these ideas…
Sunset at Waikiki beach in Oahu, Hawaii. Not a bad place to earn an income, or reason to adopt these ideas…


2) Set goals for yourself financially, and make sure at least one is attainable in the short term. Why do you want to be successful with personal finance? Do you dread the thought of living paycheck to paycheck like ~75% of Americans (I can’t believe this number), do you aspire to a life on the beach at age 35, or are you simply looking to have some financial freedom in life? Maybe you want the ability to work in a field that is not necessarily the highest paying but, for you, is the most rewarding? Whatever the reason, identify it. This is your big overarching goal, the one you’ll constantly work towards until it’s achieved.


With the major goal identified, let’s take the gaze down from the stars and onto the path we’re currently walking. One thing I’ve learned is that no matter the subject, if you can’t accomplish victories (regardless of size) along a journey, then it becomes difficult to stay the course. So what can we do about stacking the deck in our favor? Now that you’re earning an income you’ve given yourself some options. Maybe you’d like to save a certain amount of cash for a rainy day or perhaps you want to pay your own way through school? Is there a concert you’d love to see or do you want to save up for a car? Heck, maybe you’d love to earn your first hundred dollars? Depending on the income you’re earning and the cost of some of these items, many can be achievable in a few weeks/months.


I’ll relate this to the story of our family’s student loans. After Monica (my wife) and I got through both undergraduate and graduate/professional school, there were about 15 or so individual loans comprising a large, six figure, sum of money. The interest rates were all pretty similar, meaning there wasn’t much financial incentive to pay one off before the next. There was one difference though. A couple loans were a few hundred dollars, some were a few thousand, and others were in the tens-of-thousands range… We decided to pay a little extra each month and eliminate the lower balance loans. Now, when  looking at our balances we’re down to 10 loans rather than the original 15. This has financial implications I plan to get into with later posts but aside from that, every time we visit that website we see the 5 loans at zero balance. They’re paid in full. It makes me smile every time I log in. In working toward our ~10 year goal of paying off this gigantic sum of money, we’re achieving victories along the way. Each time we are able to pay a loan off, no matter the size, we make sure to acknowledge what was accomplished and have a little celebration. It’s a tremendous feeling that fuels us for the next leg of the journey.


In my family’s example and in your situation, it’s important to work toward a variety of goals. Whether you’re paying off loans, building your savings account, or saving for a trip, achieving a small goal along the way can help push you to stay focused on your long-term, overarching goal.


In this vein, some of the best leaders I know or have read about all have one thing in common… They are great motivators. They can push people to work harder or smarter toward a common goal. Be the best at motivating yourself. Learn what drives you and use that to set your sights on a prize. The process of holding yourself accountable to you can push you to achieve things you haven’t imagined. Tools outlined in the following posts will help provide you with a foundation to achieve your goals, financially and otherwise. So stay tuned, and good luck on the journey.


Thank you for reading! If you’d like to read about our other financial musts, check out Must Post 2, Must Post 3Must Post 4, or Must Post 5.
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