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What Young Adults Should Know

Last Updated: BY Michelle Schroeder-Gardner - 97 Comments

Disclosure: This post may contain affiliate links, meaning I get a commission if you decide to make a purchase through my links, at no cost to you. Please read my disclosure for more info.

Hey everyone! Today’s post is all about different financial related skills, behaviors, etc. that young adults should know.

As a 24-year-old, there are many things that I wish I knew when I was just a little younger.

Yes, I know that I am young, but almost everyone has something in their lives that they wish they would have done just a little differently, right?

Your cover letter does matter.

When I was applying for my first “real” job after college a little over three years ago, I always submitted a cover letter. I do think that this helped me land more job interviews.

However, I know of many people who when applying for jobs never attached a cover letter or never changed the “objective” section of their resume. They would just submit their resume to hundreds of companies in the area and would never get a call back. You are just wasting your time! You need to put in effort. This does matter.

All of those clothing items don’t really matter.

Yes, I like to look nice every now and then, and so do others. You can buy a couple of “trendy” items, but you should be buying classic pieces that are quality. Buy things that you know you will wear, and don’t waste money on the rest. 10 years from now you most likely won’t be thinking about that awesome dress that you wore one time.

I am guilty of this. I went shopping the other day, but it was for the first time in what seemed like forever. I went on a non-official clothing spending fast without even realizing it. However, before I would spend hundreds of dollars on clothes each week without even thinking twice.

This is one of the big money management tips for young adults that everyone needs to realize and know!

Find a different way to pay for schooling.

This is another one of the money management tips for young adults that I wish everyone realized.

College is expensive. And I’m sure that there are different ways that you can pay for it, instead of entirely relying on student loans.

I finally eliminated my student loans in July of this year, which is awesome, but I did graduate from undergraduate school over three years ago. I do think that if I would have tried harder and not taken out so much to fund my shopping habits, that they could have been done much more quickly. I sure am happy though!

Understand what a credit score is, and how you can improve it. 

Many people do not fully understand credit scores and how to improve it. For example, surprisingly, many people think that just paying the minimum payment on debt with interest (such as a credit card) will actually pay off the debt quickly. NO! You should be paying more than the minimum payment, or you will be paying a lot in interest with each payment. Just paying $25 a month on a $1,000 credit card bill isn’t getting you anywhere.

Also, many do not know that carrying maxed out credit card is hurting them. Well, it is. And it’s decreasing your credit score.

Credit scores are important. Even if you think they are the devil, at one point in your life you may need it, and you can use your high credit score to your advantage. You can obtain low-interest rates (such as 0%). Or you can use your good credit score to get a mortgage with a low-interest rate.

Read more about a credit score and a credit report.

Buying a house is a big step, and there is no need to rush it.

We bought our first home at the age of 20, and while I wouldn’t change a thing, sometimes the negatives of home ownership pop up. For example, just last night, we thought that we would fix a running toilet ourselves. Well, that went downhill really quickly and a water line burst and flooded our bathroom. We had to call an emergency plumber and that cost $225 for him to fix something that should have only cost us $20 if we would have done it correctly the first time.

If you need to rent your first, second or third place (or whatever for that matter), that is fine. Renting is not always throwing money away. If you rush to buy a house and hate it, you will likely be wasting much more money.

Life is meant to be enjoyed.

I am finally realizing this. Life does not have to be a race to the finish line. I finished with two undergraduate degrees by the age of 20, and then received my Finance MBA at 23, all while working full-time. I don’t know why I did this. Yes, I did have fun, but I often think about how much fun I would have had if I studied abroad or took summers off to really enjoy myself.

I am changing this now. I have some travel plans made, and want to make some more. We are thinking about long-term travel as well.

For us, we also like to have hobbies, and some of our hobbies include cars. Not everyone enjoys cars, but we truly do. We like our Wrangler, because it’s fun to drive around in, we like our Camaro because that’s of course fun also. We also have a classic truck, but we are going to sell it because we have been letting it deterioate, and any good car person should know not to let that happen. We would rather someone else enjoy it. If you’ve never had your license before, then getting temporary learner driver insurance from ILD is important just in case something happens while you are learning.

Money Saving Tip – No matter how much money you make, some sort of budget is always important.

Yes, another money management tip for young adults. I don’t care how much money you make, a budget is always a good thing. If you’ve never ever had a budget and you have never saved a dime in your life, then a budget is needed. If you are not saving enough money then you should create a budget and see what needs to be eliminated.

Read Does Your Budget Suck?

Whatever you enjoy in life, your job should allow for that.

I understand that not everyone wants to find passion in their jobs. Some just want to go to work, make a paycheck and go home. They only care about the money. However, I do think that there should be at least some sort of positive in the job that you have. Maybe if you don’t LOVE your job, it at least allows you to do what you love in your spare time – such as work on cars, travel, volunteer, etc. If you don’t know much about your company, research its Business Profiles before you partner with them.

Read What’s Stopping You From Living Your Dream and Being Defined by Your Job or Career.

What other lifestyle and money advice for young adults would you give?

 

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About Michelle Schroeder-Gardner

Michelle is the founder of Making Sense of Cents, a blog about personal finance and traveling. She discusses how her business has evolved in her side income series. She paid off $40,000 in student loans by the age of 24 mainly due to her freelancing side hustles. Click here to learn more about starting a blog!

Comments

  2. Rebecca says

    Great post. When I was applying to jobs after graduating, I created three resumes and updated every resume to fit the job I was applying for, then I wrote the cover letter. It was exhausting, but I did get a teaching job a year after graduating (I know many people who are still searching for teaching jobs!)

    My biggest regret is not trying harder in community college and applying for more scholarships before transferring. I’d have signicantly less in student loans. You live and learn.

    Reply

  3. E.M. says

    Life not being a race is really important. We are only young once! I struggle with this too sometimes and it’s always good to remember. We should always make an effort to enjoy the experiences we are having, be it college or traveling. Great tips!

    Reply

  5. Holly@ClubThrifty says

    I totally agree about filling your wardrobe with timeless pieces. The trendy stuff goes out of style buy the high-quality classics don’t. I’ve kept most of my best stuff because it will probably never go out of style.

    Reply

  6. The Warrior says

    First, Michelle, you thinking about this at 24 is waaaaay better than most of us. I wish I had my head on straight at your age.

    A big suggestion of mine is similar to Financial Samurai’s post “When Is The Best Time To Start A Business? When You Are Young, Broke, And Naive”. I wish I would have taken more risks and spent more time putting in true passionate work when I was poor and single rather than like now married and with a Little Warrior.

    I also suggest any and everyone try to travel as much as possible when they are in their early 20’s. When I went to do volunteer work in Aussie, my life completely changed. Without that, I’d be in a much different place.

    Great sugg’s here Michelle. Congrats on all your success. I’m 29 and much further behind than you are at 24. Great job and keep at it!

    The Warrior
    NetWorthWarrior.com

    Reply

  7. Christine says

    Love this post! I SO SO SO wish I would have understood more about credit when I was younger. I took the route of NO CREDIT, CREDIT IS EVIL and then had to face building my credit from scratch at age 27. #oops I also wish I would have realized earlier that life is meant to be enjoyed! There’s no reason to work your life away doing something you don’t enjoy!! Great job on another awesome post!

    Reply

  8. Kate says

    These are all great tips. I especially love the one about budgets. We save almost 50% of my income right now and after bills are paid we have more money in the account, which makes it easy to go on shopping sprees. I notice the “more” money we make the more our discussions about budgets come up.

    Reply

  11. Kali @CommonSenseMillennial says

    I’m right there with you on the “life is meant to be enjoyed” part! I went to college early, graduated early, and worked through all of school. While it’s turned out well, I do wish I would have known that I was flying by opportunities I may never get again. I didn’t study abroad or pursue certain things because I was afraid it would throw me too far off track.. off track of what, I’m not really sure, because there sure wasn’t a prize for graduating early!

    Reply

  12. Matt Becker says

    I love your point about enjoying life. There’s a lot of benefit to working hard and advancing your financial place in life, but if you can’t learn how to have fun along the way then really what’s the point? Money and achievement without a truly fulfilling purpose is empty.

    Reply

  14. Todd @ Fearless Dollar says

    All of these thoughts are great–especially your final one. I think that we hear “pursue your dreams” a lot. But not everyone can do that, and doing so may actually dissatisfy some. We SHOULD have room outside of our careers to really live a life we enjoy.

    Reply

  15. Connie @ Savvy With Saving says

    I voted, good luck!! 🙂

    Great list and I agree with you on most of those. One thing I wish I knew is that more money doesn’t necessarily mean you’ll be happier. I use to think that once I reached a certain salary, I would be happy and content with my life. However, now that I’ve gotten to that point, I couldn’t disagree more. I think it’s important to at least like what you do and it’s worth it even if you have to take a pay cut.

    Reply

  17. Girl Meets Debt says

    You are so wise for a young woman of 24 Michelle! I admire and envy you haha. 😉 I wish I knew 5 years ago that debt wasn’t “normal” and that I was more serious about paying it off…

    Reply

  19. Candice says

    I’m always telling people how important cover letters are! Sometimes your resume might not be that great or you might not have much experience but if your cover letter is great you’ll get an interview.

    I’ve been working full time since August and I really do feel that having a job that you hate, even if it pays well, is a waste of life. I don’t enjoy my life everyday and that’s why I’m trying to change it by starting my freelancing work.

    This post is so inspiring.

    Reply

  20. Tanya says

    Great advice. Its all very practible. We bought a home but we took our time with it. We probably looked at over 30 houses before we choose this one.

    Reply

  21. Alicia @ Financial Diffraction says

    I ended up tailoring all my applications for each job I applied for, and the CEO of the current company I work for mentioned how easy it was to read my cover letter into my resume. He also mentioned how well it flowed, which is a feat in itself since it was a mixture of Science Academia and Industry. All I know is that the hour I spent doing those things paid off big in the long run.

    I agree so much about the home ownership thing. Yes it might be the “next step” that everyone is “supposed to” do but I hated it. I was a home owner at 24, and still am at (almost) 28, but now we rent it out and rent an apartment in another city. If I could go back I wouldn’t have bought – it was too much responsibility when I was in grad school, and single.

    Reply

  23. Emily @ Urban Departures says

    I agree, cover letters DO matter. When I was applying for my first job, I tailored every one of my cover letters to the employer and position. It’s true what they say about first impressions, right? And a cover letter is the first thing employers see.

    Find a different way to pay for schooling is also so important. I was lucky to have my parents pay for my education, but if I had the foresight to apply for bursaries and scholarships or took an internship, it would have helped them out financially.

    Reply

  24. Alexa says

    I would tell my younger self to finish college. But then again if I didn’t work these crap jobs I might not appreciate the things I have so much. I would definitely have told my younger self to save some money especially when I had no bills to pay.

    Reply

  25. Dani says

    I definitely agree with all of these, but I especially wish I had started budgeting earlier, and started paying back my student loans sooner. So much of the financial woes I faced within the last few years could have been so easily avoided if I had just contacted those loan companies directly after college. Definitely a learning experience! I did enjoy life though, and I’m happy I did!

    Reply

  26. Krista says

    I would add that even if you take some loans you don’t need to take everything offered in student loans. I feel like students assume ‘Yes! I qualify for 10,000 a year so that’s what I’ll take!” instead of qualifying for that much but only taking the 2-3000 that they really need. Decide what you absolutely can’t afford before you commit to taking on that much debt, as you said it’s not always necessary and it’s hindering for those stressful after-college years.

    Reply

  29. krantcents says

    I started very early in life to learn these things and many more! I made accounting and finance my career because I had the talent and skills. The results speak for themselves.

    Reply

  31. Tara @ Streets Ahead Living says

    I can’t recommend the coverletter bit enough. Something that is so easy to do once you have a decent template, having a cover letter to help you apply at other jobs really makes a difference between your resume and the pile behind yours.

    Reply

  32. Al says

    We are quite similar! I earned my Masters Degree right before my 23rd birthday. I also now wish I would have enjoyed life a bit more & found a more reasonable balance. There’s a really great Ted Talk by a clinical psychologist called “30 is not the new 20” and it did make me feel better about my previous “all work & no play” laser focus. The work I did has also provided me the opportunity to pay off my loans and now my hubs and I are also planning on traveling as much as we can too. Great post & good tips!

    Al
    http://www.herbearings.com

    Reply

  33. charles@gettingarichlife.com says

    Wished when I got my first job out of college not to waste my money on lifestyle inflation. When you’re young you think you have all the tim in the world. Definitely some type of budget is needed.

    Reply

  34. Hayley @ A Disease Called Debt says

    Great advice Michelle and I agree especially with the points about buying clothes and being in a rush to buy a house. The hubby and I bought our first house when I was 22. It was great but it tied up our cash which we weren’t very responsible about at that time in our lives.

    That’s when we accumulated a lot of our consumer debt because money was tight and we had a mortgage to worry about. Selling a house if you find that you can’t really afford it is not that straightforward and can take time as well as a lot of expense in estate agent and solicitor’s fees so it’s well worth thinking about carefully.

    Reply

  35. Mark Ross says

    Well, I’m young enough and I haven’t done most of those yet. I’m very grateful that I read those, so that I would know what should be or shouldn’t be done. Thanks a lot Michelle!

    Reply

  36. DC @ Young Adult Money says

    Great list, Michelle. While I agree it’s bad to rush your first home purchase, I also think it usually is better to buy it sooner rather than later, as your equity can build up. With that being said I have had my share of stressful situations where I’ve had to bring in contractors and write checks. I wish I had known that not everything depends on what you major in during college. What I mean by that is I’m an accountant but was a finance major, and now I am more interested in the IT side of it all as well as data management…and I’d say beyond that I’m even more interested in online income and building revenue streams through online assets. None of this really falls in line with my finance major or what I would have envisioned my career to be. So don’t stress too much over your major, just be open to what type of work you are interested in and may be interested in later on.

    Reply

  37. Little House says

    I definitely wished I would have traveled more in my 20’s after college then been more savvy with finances in my late 20’s, early 30’s. Around my mid-30’s I finally started to figure it all out. Sounds like you’re on a great path and you’re only 24! Way to go!

    Reply

  38. Eva @ Girl Counting Pennies says

    I really enjoyed reading this post, Michelle! Two undergraduate degrees by the age of 20? Can I just say that I am very impressed! Life is most certainly not a race and must be enjoyed too! This is great that you are thinking about long term travelling too!

    Reply

  39. Jacob | iHeartBudgets says

    Great list! I would add (as others have said) SAVE FOR RETIREMENT STARTING NOW! I start at age 18, but then stopped for a long time. DOH! To think about how far ahead I could be, and how I could have pushed retirement up to 5 or so years sooner, kinda kicking myself now. And it’s easy to do! Just start small and make it a habit 🙂

    Reply

  40. Lisa E. @ Lisa Vs. The Loans says

    Last night I sent out 5 job applications with 5 different cover letters and I spent so much time customizing each and every one to fit the job descriptions. Let’s hope this works! *crosses fingers*

    Reply

  43. Whitney @ EHFAR says

    I’ve always sent out a cover letter. So important! A resume only tells so much.

    When I was in graduate school, I was shocked at the people who didn’t do that and know to do so. I also overheard a conversation that a girl was having… she was annoyed that a place didn’t accept her resume and was told she needed to submit a cover letter. Sorry for the language, but this is day one shit. Haha.

    Reply

  44. Brian @ Luke1428 says

    My desire would have been to understand how to be a better leader. At my job, with my family, in other relationships, etc. I always assumed leaders were born, not made. That’s a myth. Leadership can be learned just like anything else.

    Reply

  46. jefferson @See Debt Run says

    somehow when i was younger and had no responsibilities, i still managed to live paycheck to paycheck and spend everything that i earned.. i wish i could have somehow looked at things with a bit of a big picture view back then.. but i just wasn’t there yet…

    Reply

  48. Mike Collins says

    I wish e had waited to buy our first home. At the time the real estate market was still soaring and we were afraid we’d get priced out forever. Instead we were LUCKY to break even when we sold and moved into our new home last year. I know people who are $50,000 underwater on their mortgage.

    Reply

  49. Maggie@SquarePennies says

    Love what you said about clothes. I’ve known people who run up $10,000+ credit card debt in college just on clothes!
    What I wish I knew when I was younger: good things will not drop from the sky into your lap! You have to actually be determined to make good thing happen. And it’s up to you to find out how to make it happen step by step!

    Reply

  51. MyMoney powered by Purdue says

    Remember you don’t have to live like your parents when you’re first starting out. It took them years to get there and there’s no need to feel like you’re living without if you don’t have the same type of life.

    Reply

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