Why Saving Money In Your 20s Is A Good Idea

Recently, I read Elite Daily’s article If You Have Savings In Your 20s, You’re Doing Something Wrong. There are so many things wrong with this article. The author in this article basically says that you should spend all of your money in your 20s, even if you have money to start saving in your 20s….

Michelle Schroeder-Gardner

Last Updated: December 28, 2023

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Saving money in your 20s is a great idea and I don't want anyone to make you believe otherwise. Start saving in your 20s today!Recently, I read Elite Daily’s article If You Have Savings In Your 20s, You’re Doing Something Wrong.

There are so many things wrong with this article. The author in this article basically says that you should spend all of your money in your 20s, even if you have money to start saving in your 20s. Saving money in your 20s to her means that you are boring, lazy, and just planning for your death.

To state the obvious: I disagree with her article.

I believe that saving money in your 20s means you’re doing something RIGHT.

There are tons of horrible advice in her article such as:

What memorable experience does money in the bank give you? How well-rounded can people become sitting at home, watching their limited funds gain interest?

As well as…

When you’re 40, you’re not going to look back on your 20s and be grateful for the few thousand you saved. You’re going to be full of regret.

I read this article over and over again to see where the author would say “Gotcha, April Fools!” However, that never happens. I’m sure this article is mainly just click bait to get people to head on over to their website. I think the advice is horrible and I’m hoping no one is following the advice of this author. However, I’m sure at least a few people are taking her seriously…

There are so many reasons to start saving money as early as you can. I don’t think I’ve ever heard someone say “I regret all that money I saved when I was younger.”

In fact, it’s usually the exact opposite.

Considering the fact that 36% of people in the United States have absolutely NO MONEY saved for retirement (according to a survey done by Bankrate), I think there are many who probably wish they had savings.

There is absolutely no reason to spend all of your money just because you want to. It doesn’t make any sense to me to blindly spend everything just because it’s there!

Below are several reasons for why you should start saving money in your 20s.


You can learn good habits now.

One of the top reasons for why many don’t save and invest is because they claim that they don’t know how. Yes, the beginning of saving money and investing may feel like a whole new thing, but it is possible and it doesn’t have to be hard.

The sooner you start saving, the more it becomes more of a habit and the easier it will become. By saving money in your 20s, you will learn good financial habits that will help you well into the future.

Related articles:


Leading a good life doesn’t have to make you broke.

As you all know, I really dislike the myth that people who save money are boring. That’s just not true at all.

There is absolutely no reason to go broke and spend all of your money in order to have a good time. I believe that you CAN balance living a good life along with saving money in your 20s.

There are plenty of ways to live an awesome life while saving money. Yes, you can still see your friends, have fun with your loved ones, go on vacations, and more, all while staying on a realistic budget.

Related article: How To Have Frugal Fun


Compound interest is a powerful thing.

Saving in your 20s is a wonderful thing, especially due to the fact that time is on your side and due to the powerful impact of compound interest.

Compound interest is one BIG reason for why you should start saving money as early as you can (especially for why you should start saving in your 20s).

Compound interest is when your interest is earning interest. This can then turn the amount of money you have saved into a much larger amount years later.

Side note: I recommend you check out Personal Capital if you are interested in gaining control of your financial situation. Personal Capital is similar to Mint.com, but much better. Personal Capital is free and it allows you to aggregate your financial accounts so that you can easily see your whole financial situation, including investments.


Just because you don’t have “wants” doesn’t mean you won’t have “needs.”

One thing the author said in her article was that she doesn’t save money because she has no “wants” in life.

This is a horrible thing to say as you may have NEEDS that pop up that require savings. You never know if you may have a medical emergency, if you may lose your job, if your car may break, and so on. Having savings can help get you through hard times.

Plus, you never know how things may be in the future. Just because you don’t want to start saving money in your 20s now doesn’t mean that you won’t want to save later. You will most likely regret your past if you make the huge mistake of choosing not to save money.


Why not start saving money in your 20s if you can?

Saving money in your 20s is better than not saving anything.

What is the reasoning behind spending money just because you can? I see no point in actively trying to make sure you don’t have money leftover.

Like I said earlier, there is no reason to spend all of your money just because you are able to. It doesn’t make any sense to me to blindly spend everything just because it’s there. In my opinion, saving money in your 20s is always a great idea.

Even if you are only able to save a small amount, that is much better than not saving anything. Remember, time and compound interest are both on your side and this can turn the small amount of money you have saved into a much larger amount.

To summarize this whole post: You should start saving in your 20s if you have the ability to.

Are you saving money? Why or why not? What do you think of the Elite Daily article?

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Michelle Schroeder-Gardner

Author: Michelle Schroeder-Gardner

Hey! I’m Michelle Schroeder-Gardner and I am the founder of Making Sense of Cents. I’m passionate about all things personal finance, side hustles, making extra money, and online businesses. I have been featured in major publications such as Forbes, CNBC, Time, and Business Insider. Learn more here.

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  1. Sheesh! Sounds like ‘click bait’.

    If only I’d saved money in my 20’s!!! I’ve got lots of memorable experiences but I think I could have balanced those experiences with a good managed fund and not felt deprived.

    Compound interest is one of life’s nasty little jokes… you finally get it when you’re too old to make use of it! At least, that’s been my experience. I knew about compound interest and how important it was but I always figured I still had time to make the most of it. Ha! Too late now!!! 🙂

    You live and you learn – if you’re lucky!

    1. Haha I feel like everyone feels this way!

  2. Oh man, I wish I had thought about these things when I was in my 20s. Compound interest is a magical thing. Luckily, I think your advice still applies to people in their 30s (like me), and really of almost any age. I really believe that even if you’ve made irresponsible financial decisions in the past, it is possible to turn things around — that’s what I’m trying to do now, by consciously saving and investing and working towards paying off my student loans.

    1. Yes, it definitely applies to every age 🙂

      Yes, it is still possible to turn things around. I hope the author realizes that she can still change her ways.

  3. Crystal

    I totally agree with you. I started my first job when I was 18. I worked for a grocery store that had an employee stock buy-in program where they took so much out of each paycheck and bought stock with it. Even if it was fractional shares. I didn’t want to do it because I thought I needed as much as I could get. However, I had a manager that basically forced me to do it. It was the best thing I ever did.

    When I was 22 and just graduating college, I bought my first townhouse with that stock money!!! Not many 22 year olds can do that. And of course, I made money when I sold it a few years later when I got married. Kids and even adults don’t realize how important it is to save. I sold investments for a bank as my first job out of college, and I had to convince adults that if they took money from their paycheck to invest in a 401K that they wouldn’t miss it. Not to mention the fact that at a minimum they needed to invest in what the company matched. You can’t beat a 100% return on investment. My daughter’s dad and I are currently trying to convince her of that now. And she’s 21. I will be forwarding this article to her. Thanks so much for writing it!

    1. Nice! Sounds like you are doing well 🙂

  4. Esteban


    Great advice as usual. I also wrote a small blog about saving as early as possible.
    I first started investing 2-3 years ago and it’s incredible what compound interest can do.
    Definitely advise anyone to do the same!

  5. Total click bait. What a great way to get her name out there – the media is so weird in that way. I much prefer to listen to the opinions and wisdom of PF bloggers who seem to care about their credibility, not just clicks. Saving in your 20s is so important. Saving in your TEENS is possibly even more important. I feel like the attitudes we cultivate in college — and even earlier — are so hard to change. If you adopt that “pay yourself first” mindset as early as possible, it sets you up for a lot of success later. I try so hard to slide these topics into conversations with my students, even if it’s just us hanging out in the cafeteria!

    1. Yeah, that site is crazy to publish such a bad article.

  6. Oh man, what a terrible article! I hate to think that even one person took them seriously. Are you sure it wasn’t posted on the Onion?! Saving money in your 20s is the absolute best thing you can do to set yourself up for success. Save the money while you’re young and unattached. You’ll have more money to buy a house, comfortably raise kids, and take great family vacations. You should spend some of your money when you’re young too, though. There’s no reason you can’t both have fun and save!

    1. Haha I wish it was on the Onion!

  7. jackie

    wow I can’t believe someone wrote that article! i think starting to save in your 20s is such a good idea. and with compounding interest, you don’t need to go broke to do it. i started in my late 20s and wish i had started even earlier!

  8. Michelle,

    I went back and read the article too. This has to be the dumbest thing I have read about money:

    “Your 20s are not the time to save; they’re the time to gamble. $200 a month isn’t going to make the dent that a $60,000 pay raise will after spending all those nights out networking.”

    Don’t get me wrong, I like to have a few drinks and network. It’s important. But to put off saving money in your 20s to get smashed every night, pass out, wake up in a random’s apartment, isn’t going to make you $60k a year….it’s going to require a shot of Penicillin.

    If you read the bio of the author -you’ll see what I mean.

    The click bait worked – I clicked on it and there are many financial bloggers talking about it.

    Nice post Michelle!

    1. Haha yes, the click bait definitely worked!

  9. I think the first point, about the habits formed, is the key point. Did I save a lot of money in my 20s? Hardly. I started off making a quarter of what I make now, and so the opportunity wasn’t there. However, because I started saving, even as little as it was, I continued on as I got older and brought in more money. Does the author seriously think that someone who avoids saving in their 20s is all of a sudden going to reverse course and start socking money away once they hit 30? It won’t happen! By that point, the lifestyle and the bad habits are formed.

    Amazing that such a bad article got any attention at all. Thank you for doing your part to try to disarm this and provide perspective that actually makes sense!

    1. Yes, you hit my main point exactly! If someone is used to spending money, it would be very hard for them to reverse course.

  10. Valerie

    I am 40 and wish I would have saved in my 20’s! We started saving in my 30’s and recently we had to spend almost all of the money we saved just to make ends meet. Saving is so important. You never know when you are going to need it.

  11. Cassie

    I completely agree with this post. Compound interest just changes the way you look at things. My uncle is in his 50s and didn’t start saving until he was around 30 – he regrets his decision now. Sure, he got to do a lot of neat things in his 20s, but the prospect of trying to save enough for retirement and being unable to make it can be terrifying – especially in the world we live in today. When you think about it – we need well over 1 or 2 million to retire happily and comfortably and most of us will never make it there. So, the best we can do is start saving today in hopes for a happier tomorrow!

    And who is to say that you can’t be happy while living frugally and have a million experiences that you won’t regret? I’m writing a blog right now about how I’m trying to pay off my $200,000 in debt, how to live frugally, and a bunch of DIY crafts. I had a beautiful and memorable wedding and it didn’t break the bank. There are ways to have a great time without spending a ton and even a tiny bit in savings is better than nothing.

    1. Yes, you can definitely live frugally and have a great life – I agree 🙂

  12. Amy @ DebtGal

    I’m 40, and I wish I had saved more money in my 20’s. The point about compounding interest is a really important one. And now that I’m older and have more “adult” needs, wants, and expenses, I appreciate how much things cost – cars, house maintenance, propane, healthcare, activities for children – it adds up!!

  13. StephTheBookworm

    I’m in my 20s and trying my hardest to focus on savings and retirement. We don’t have a lot of extra money each month, but I’ve been contributing to my retirement fund at work since I was 22. Even though it isn’t much, it’s a start! I’m also working on debt repayment and trying to rebuild a regular savings account since we used a lot while I was on maternity leave.

    Great advice and article!

  14. If I were in my twenties, the only person I’m taking advice from would be someone successful in their thirties, forties, or beyond. The article felt like talking to a frenemy who is egging you self-sabotage yourself because they want to see you fail.

    Don’t save money! That’s for suckers! Go have fun! Hilarious.

  15. Melissa

    Believe it or not, I have read this advice in so many places. And I still can’t believe it!

    Learning how to save early on is one of the best things you can do for your financial future, and it doesn’t mean you’re sitting around rotting away. You can learn how to save and still have rich experiences in your twenties!

  16. It’s so sad that so many young people don’t understand the power of compound interest. This is something that should be taught in schools.

  17. Yes, that’s why this article is such a problem. I’m sure many people read that article and thought “Okay, so I’m fine then!” AHHHH

  18. I love this post! As a barely 23 year old (my birthday was two days ago, haha) it seems INSANE to me that people wouldn’t save in their twenties. I’m currently living on 50% of my income and enjoying the exact same lifestyle as most of friends. With a few barely noticeable tweaks (no car, only eating out on special occasions, hacking beauty and fashion, etc.) I’m able to live what I consider a ridiculously luxurious lifestyle while also working towards my future goals/freedom. I think the key is to stay in the college mindset of being “poor” even after graduation and never succumb to the dreaded lifestyle inflation 😉 Thanks for sharing your wisdom!

    1. Happy birthday Taylor! Great job on saving 50%!

  19. Gina

    I’m in my early twenties and I don’t ever remember a time when I wasn’t trying to save money. I was that kid who put away their birthday money in a bank account rather than go buy something right away. My parents taught me that savings were important and so I’ve remembered that and tried to save my whole life. My husband and I have tried to save, but as you said things come up. Every time we’ve had some surprise expense, we’ve always had our savings to help us out. If we didn’t have those savings, I know we would be in a world of hurt. I can’t imagine not saving, especially on purpose. It’s just crazy to me! And I agree that saving money doesn’t make you boring!

  20. I am now 26 years old and still not that serious with regard to saving money. But, I am trying to save as much as I can even though I am still paying my student loan. It is really hard to prioritize saving. I think after paying it off, I’d be committed to saving so that I can keep with the years lost.

    1. Sounds like you are serious to me 🙂

  21. Brittney @ Life On A Discount

    I was seriously baffled by that article when I read it. Unfortunately, I know quite a few people who live by her advice and approach. They will say, “you can’t take money with you when you go” or “you only live once.”

    I by no means think you should save every penny without any intention of spending it. But you should spend purposefully, just like you should save purposefully. Having goals, a plan and an approach can be incredibly empowering and meaningful. When you decide why you are spending or saving, you are in control, regardless of the income amount you are earning.

    Rather than just saying, “save” or “spend” people really should focus on having a plan and knowing why they are doing what they are doing.

    1. Yes, having a plan is important.

  22. Saving money at ANY age can be beneficial. Thank you for this post and inspiring all ages to start saving now or to continue saving.
    I wish I would have read an article like this in my early twenties just for the knowledge of compound interest.

  23. Lila

    I quit reading her article half-way through. Total click and bait.

    I live within my means and I don’t deprive myself. There are a lot of fun things that are low-cost or free such as going on hikes, going to the zoo, going to parks, going to museums, going to the library and community events, etc.

    I also am subscribed to 4 monthly subscription boxes, memberships to Hulu, Netflix, Audible, Amazon Prime Student, and 2 magazine subscriptions. I have a spending plan (budget) and plan out everything I need/want for the month.

    I’m not rich either, I’m a student at a state uni. and I make it work! ^_^

    P.S. I listen to Dave Ramsey’s show and he has many families that are making average incomes from $30,000-50,000 and they’ll have like $32,000 in savings, paid off their debts including student loans, and are saving for their children’s college funds, etc.

    You can have excuses or you can have results. I’d rather work smart and have results.

    1. Yes, I’d rather work smart and have results.

      Great job Lila!

  24. Great advice, in my personal opinion is never too early to start to think about finance, maybe schools would must introduce calsses to teach it!!

  25. Reece

    Wow. It sounds like that article was written entirely as click bait, as you first commenter has suggested. Absolutely ridiculous! What annoys me the most is the ‘all or nothing’ approach that is suggested. No one said that you had to save every spare bit of money that you have, but saving in your 20s is going to give you a huge financial headstart. As you said, compounding is a wonderful thing- even better if you can get a 10 year headstart on it 🙂
    I agree with you entirely on this. I, personally, am 26, and I am trying to balance everything in my life- with some success. I save a bit, I have a couple of properties as investments, and I get out there and travel…..on the cheap. None of it is easy, but it can be done. Life in your 20s doesn’t have to be either reckless or boring, why not try the best of both?!
    Thanks for sharing this post, it was really interesting for me.

  26. Nicole

    I agree with you 100%. I can’t believe someone would give that kind of advice! I feel like people in their 20s are much less likely to have stable careers than people who are older, which is all the more reason to save. I’m relatively new to the PF blogging world, wanted to drop by and say hi! Great post.

  27. I saw that article and truly hoped that it was a “statement piece” to get people talking because it really struck me as nothing but crazy. I started saving in my early twenties and although I didn’t save exactly where and how much I should have, those savings have allowed me to pursue the passion I discovered in my 30s. I didn’t even know what it meant to be passionate about work in my 20s and if I didn’t save when I did, I would miss out on the joy I’m experiencing now of pursuing what I love.

    1. Yeah, I’m not sure either. If it was to just get people talking, I wouldn’t want to attach my face and bio to that article haha!

  28. fehmeen @ Debt Free Lifestyle

    I agree, it is never too early to start saving money. While this article encourages saving which in your 20s, I know there are lots of parents who setup saving accounts for their teenagers, and sometimes even children younger than that. I love that idea. One, because it really is never too early to build assets for your children. Two, the earlier you teach your children about frugality, the better money managers they will become as soon as they are old enough to own a credit card, which is at a pretty young age!

  29. The suggestion that saving money in your 20s is a bad idea seems ridiculous to me. I get the point that they are trying to make; you should enjoy your fleeting 20s. The problem with their thesis is the suggestion that you need to spend every last dime in pursuit of that. There seems to be this myth that you don’t need to take your finances seriously until your 30s. People following that advice are likely to find that their 30s are spent with high-interest debt, a lousy credit score, and denied loans. Unfortunately, this is just around the time people start thinking about starting a family and buy a home. Both of those goals will be difficult without fiscal fitness.

  30. I agree with you. The article definitely sounds like click bait. I don’t know who in their correct mind would give such foolish advice. I wish I would have saved money 20’s My finances were up and down during that time. I’m finally doing better though.

  31. Sarah

    I’m approaching mid-20s and I couldn’t agree more! I never understood friends that maxed out there overdrafts while being a student. Noone wants to sit on that kind of debt when you graduate and are pressured into finding a job to only then pay off the debt rather than saving the money! I stuck to a tight weekly budget and managed to make it work without missing out on the social life. Now that I have a steady income I still live within my means and often save half of what I earn! It makes me less anxious knowing I will have cushion to fall on when the day comes that I’m tight on cash plus where else do you get your money from to travel in your 20s??

  32. Raz | MakeLivingGood

    Hi Michelle,

    There’s always something interesting on your blog that I can find and read. Please keep up the good work 🙂

  33. Sayel

    I think more than investing «money» in your 20s you should invest in yourself. Simply because you have a longer time to live it makea sense to invest in something you’ll enjoy in the future. Now investing money is ONE way to do that and of course compound interest will make it attractive. But it’s important to know there are at least 2 other options to choose for you to pick.
    1) invest in earning (rather than saving) more. This is different to just put your money in an investment account, this could mean to get some safe business (not the unicorn startups but just the kind of things that will always be there). My brother got a laundry franchise, a friend a couple of chicken restaurants… Whatever, they are relatively safe income. The other important way is education. I spent a lot of money in education in my 20s (2 masters (one abroad) 2 diplomas and several smaller courses). Basically after every degree I would get a promotion. Now I’m doing a paid PhD and I’m getting pay (as a student) about twice what I was making in my job 7 years ago, plus education opened so many doors to me that now I feel confident I can get a job in the country I want in the sector I want. Talk about freedom.
    2) invest in memories. I know many people won’t appreciate this advise here, but I saw my grandparents save all their live just to travel the world when they retired. I thought it was lovely to see them going to Europe and Argentina together in their 60/70s until two years later they were too tired. Eventually my grandfather got sick and died a few months later. I started traveling in my early 30s (about 6 years ago, but even more 4 years ago when I purposefully tooka job that would take me abroad).I’ve been in almost 50 countries and I’ve seen and done incredible things I wouldn’t be able to do 10 years later. True is traveling is cheaper and easier when you’re young (I wouldn’t stay now in the hostels I stayed 5 years ago) and it really helps you build your character and opens your mind. True I could have a house and two cars if I hadn’t traveled, but I’m fine because I invested in increasing my monthly income early on so now I can travel AND save.

    I’m not saying saving early is bad, but look your options because there are opportunity costs you might not be seeing.

  34. MagniFIMoney

    Wow! I couldn’t agree more on this one. As someone who is still in my 20’s I am super stoked that I started saving and vesting early.

    Your point on the power of compounding interest is no joke either. Compounding interest waits for no one!

    It’s funny because I read that exact same Elite Daily article and remember thinking “Wow, there are millions of 20-somethings out there who will read this and start spending even more of their money thus delaying thier chance at reaching FI.” Glad to see there was a rebuttle from a fixtur e in the FI community!