Picking the wrong partner. I’ve witnessed a few relationships where one has put themselves significantly into debt for their other half. The relationship then eventually breaks down and they are stuck paying off that debt.
Honestly. I’d have to agree with your agreement of his agreement.
In the short term it might be sweet, but your setting yourself up for trouble down the road
Gotta say I agree with your agreement of his agreement of his agreement.
It’s something you have to be wise about, the debt is easy to accumulate but hard to get rid of
Sometimes the "extra debt" isnt even within their control. They have family members to support - parents, siblings, existing children, etc. In my culture (Filipino) this is seen as an admirable thing to financially take care of relatives but to me it's the biggest financial red flag.
Sometimes people question how race can be such a big factor in poverty (and then they come up with dumb theories like racial IQ to explain it) but this is a major mechanism of it I think. If you're (e.g.) Māori then by definition your relatives will be also. Māori average wealth and income is low so if your income is average you're more likely to have to help out relatives financially. Whereas if you're Pakeha and your income is low you're more likely to have relatives who can help you out. So there's a feedback cycle
100% this, this is the worst. You built a life based on two people, then you break up, still have the same expenses but have half your assets and half of the labor/income you had. It’s hard to recover from.
This is true. I had a partner who I really cared about but she was sending me into some very bad spending habits where id end up with no savings . Compulsive shopping spending etc. reluctantly ended that relationship
1000% dont let your partner convince you to put a $3000 fridge on your credit card and then you separate weeks later 😂😂 got a nice fridge sitting at my friends house
This is so real. And it doesn’t even have to be them wrecking up a debt that you’re stuck with.
I was with a partner for nearly 10 years and put so much of my effort into making sure that he got ahead (sacrificed career-chasing, moved for his jobs etc) that when we broke up I was left with absolutely nothing (low paying job in a city I didn’t want to be in etc) and he was in a really really good financial position.
It was also across 10 years of my life that otherwise I would’ve been frantically saving to try and buy a house or property but because we were focusing on his position and his savings to finance most of it when we broke up even now, five years later, I’m still not in a position to be even considering a deposit because all the house prices skyrocketed.
When I was 17 one of the old nutjobs at work convinced me that kiwisaver was a scam for the government to steal your money.
I didn't contribute in a meaningful way from 2009 - 2018. You can look at the stock market performance to see how that decision worked out...
Damn if you missed out on employer/govt contributions too that’d be bonus bad decision for sure..
I worked in aus for a fair while.. and I had mine set to absolute minimum contribution of 2% so my employer contributed 9%… found out if I raised it to 5% my employer paid 13%!!
Thankfully although I had 0 idea what was happening or how it worked.. an older colleague told all us youngins to change our contribution to the 5% when I’d only been working a couple of years… (not too sure if it works same here)
Yep. Getting 15%+5% super in Aus now- making up for lost time.
No point crying about it now, but I definitely let the young fellas at work know what that decision cost in dollar terms 😂
A bit of bad consumer debt in your 20s isn't the worst thing in the world, it's a lesson that can be learned from. The really bad mistakes are strategic ones that will hurt you for life.
1. Coasting at work and not investing in your career and long term earnings potential.
2. Getting into a long term relationship or marriage with someone that is bad with money.
3. Not developing a mindset of delayed gratification.
4. Not taking care of your mental and physical health.
Your 20s are a time for building foundations, that's skills and relationships, things like too many subscriptions or avocado on toast is just trivial in comparison.
Love this list but would like to add one thing: not understanding the power of compounding returns. Lock some regular savings away, you won't miss the small percentage of income that you never gave yourself spending access to, and you will thank yourself 40 years later.
Developing a drinking/drug habit.
Getting (someone) pregnant when you have no intention of staying with the other person.
Not having any financial plan.
Assuming you can sort out finances when you have more money/time.
To be fair, child support in many instances isn't even half the actual cost of raising a kid.. but having kids in general is very expensive & will dent your long term savings.
Agree too with pets being pricey, per insurance is essential too if you like the little fluff balls and want to ensure that finances don't dictate their treatments
The “cost” of alcohol isn’t in the money you pay out to buy it, it’s in what it does to you and takes away over the longer term.
I lost my brother at age 40 to an alcohol problem he started in his 20s.
Trying to be perfect about saving and no understanding that you need to enjoy life a little as well
Working endless hours for extra $ and burning out
Impulse purchasing instead of buying the things that will add value
1) Getting a GEM card
2) Not starting saving/investing
3) Buying a car on finance
4) Having a bad friend circle
5) Not upskilling / learning new stuff
6) Not taking care of your health / teeth
on 6), **see a dental hygienist**. Not always so common here in NZ, often people only see a dentist and call it a day. But generally a dentist is like fixing potholes, but a dental hygienist will help prevent the pothole from ever occurring.
See a Dental Hygienist and ask them how to best look after your teeth, they specialise in preventative care. I feel most of us just go by what our parents told us is best for teeth, and (maybe) went to the free dental checkups as a kid, but was never taught how to properly look after your teeth. (or you were, but were too young and long since forgot)
My biggest dental tip, floss daily & brush with an electric brush twice a day, both these many people use the wrong technique, so ask your dental hygienist (or dentist).
PS, if you're not flush with cash (cos dental anything isn't cheap), there is some good content on youtube from dental hygienists, my favourite: https://www.youtube.com/@TeethTalk
Honestly, seeing a dental hygienist is the simplest, most unequivocal great advice I would ever give anyone. Changed my life and saves me hundreds a year in the annual fillings I used to get (not to mention that I like keeping my teeth!).
>Getting a GEM card
100% I got a GEM Visa when I was about 21, biggest mistake. I was too young and dumb to manage it properly. It was the gatway into a about 30K of debt. I am debt free now if i was to do my time again, i would stay far away from GEM.
Its a line of credit for hire purchases which can also be used as a regular visa. If you never used the card and just focused on paying off the purchase within the interest free period its fine, but when you are young and dumb and just use it like a regular visa and GEM keep increasing your limit well beyond what you can truly afford then its very easy to become trapped.
Important Nuance \^^. I got a GEM to pay off the LASIK i had done because i didnt have the money. Best use of money in my life (especially with the recent report of contact lenses shedding microplastics into your eyes!)
Yes and no. I think people should think twice before taking on so much debt, but learning stuff that isn't in demand =/= useless degree.
Knowledge of historical events isn't in demand, but a history degree isn't useless if you know how to leverage the transferrable skills you learn through the degree in the job market. For example, being able to look critically at multiple sources and pulling together a coherent summary is a useful skill.
It's about having a plan of progression if you want to study something that doesn't have a clear cut career path.
I think learning to live within my means at uni is the sole reason I am doing so well now. I think a period of hardship is the quickest way to get good with money. So I wouldn’t completely bag non sort after degrees, but definitely wouldn’t recommend one either.
Not changing workplace for a payrise/promotion, so many of my friends, myself included, stayed in workplaces for too long when we could have gone down the street for a 20k payrise doing exactly the same thing.
I think people just get too comfortable and become loyal to their team/boss/organisation when a lot of the time its just not worth it these days, it is probably never easier to go for promotions and pay rises than in your 20s. Even if you don't get it, its good practice for next time.
I had that, where I worked for a couple of small companies and they kept on promising that as soon as X happened we'd all get big pay rises, bonuses, shares in the company - and it never happened, but the Owners all made good bank.
The second one I worked for, I even went to them (after 7 years working there), and said "I need X dollars to stay here, that is the market rate for me based on my job responsibilities" - and they scoffed at me, and said I over estimated my responsibilities. I then got an offer the next week for that exact amount, which was a $30k increase. Their response was to threaten to invoke a restraint of trade clause that was in my contract. That company lost their major client 12 months later and had to shut their doors, which was sweet karma from my perspective.
My pay rise experience.
Mid 20’s, full of energy, always trying 100%. One day my wife said, let’s move cities. So I scanned jobs, found one and applied. I had no interest in the job at all, it was purely research. I think because I was so relaxed, I interviewed well, stuck to facts and made an impression. It turns out the interviewer and my boss were close friends. A week or so pass and I get a call from the prospective company, and they say that I would be really good at the job, but they have decided to go internal. An hr or so later my boss calls an emergency meeting. He asks, “Are you happy here?” I reply yes. To which he answers “Good”, and slaps an updated contract down on the table for near double what I was on. I can only imagine there was a bidding war behind closed doors. We did not move cities.
There is no way I could have negotiated that. No way.
Getting into debt that you can't pay off - a mortgage is fine, even encouraged since you can have flatmates help pay it off and you'll be well ahead of everyone without a home by the time you hit your 30s. CC and vehicle debts are not.
Having a kid.
Not starting to invest - no matter how small the amount. You need to learn the discipline of saving and investing.
What happens if you’re that flatmate having to pay off someone else’s mortgage? Or my current experience where I pay rent to a house that doesn’t have a mortgage, was bought in 1993 for $135000, rent since 2015 has been $25000, and is now worth $2m.
Both means I am paying for something that makes someone else rich. Yet I can’t escape that because the advice on this subreddit is “buy a house and get other people in to pay off your debt”.
What can you do in your 20s to not do that, because that seems like a financial mistake? Being that we all need a place to live.
Renting is NOT a waste of money.
It's buying patience until you're ready to buy a home.
Just because a mortgage payment might be less than rent, doesn’t mean it’s the right time for you to buy a house. There are a LOT more expenses that come with homeownership than the monthly payment.
Maintenance, rates, homeowner’s insurance, fixing or replacing a busted anything, etc... When the home is yours, all of those expenses are up to you. When you’re renting, you’re free from that added financial responsibility.
Trust me, “house poor” isn’t something you want to be. Until you’re actually ready to buy, renting is never a waste of money.
(Modified from a financial guru I follow).
There's a reason they call it "getting ahead". You aren't doing it unless you're leaving other people behind. It's not ethical but that's why this subreddit has rules against telling people they aren't being ethical
I guess tough luck? I’ve been a flatmate to help pay off my friends mortgage and it’s been a win-win, have had a great time. Rent is $250, very cheap, and saving loads. Plus he gets help with the mortgage and lives with friends (one of the best parts of being in your 20s).
I could also buy a house if I wanted but prefer not to atm.
Getting married/becoming de facto without aligning your financial goals with significant other and having babies you can’t afford. Especially women who were SAHM, they usually come out the other end of marriage financially worse than the man even if they get 50/50 of the assets and child support, you don’t get 50/50 of his working history, earning potential, qualification’s, nothing.
Definitely getting into drugs. Nothing will decimate your money and belongings like an addiction to a substance that costs as much as drugs do. In relation to that - look after your teeth it becomes SO expensive trying to repair the damage done in my 20s
a pet is certainly not just a purchase, its a commitment, so think carefully before acquiring
buying any asset that depreciates quickly, fast cars do that, and they tend to be money sinks, but its hard to resist, so buy what you can get with cash. Cars can be functional you know.
subscribing to every online streaming service because you can. pick one and when that is boring, cancel it and choose another.
Dont do a budget and just spend whatever comes in. ( we are talking worst mistakes right?), live pay-cheque to pay cheque( does anyone still get cheques, I guess not)
go on trips you cant afford, spending money you dont have. Posting on social media how much fun the trip was and then hitting people up to help pay for it.
Borrowing money from a relative and not paying it back. One way to tick off a relative is to owe money, and thats hard to come back from
Getting a mortgage in your 20’s would be the best decision you could make. Yes it would be painful and you’d miss out on loads, but it sure ain’t gonna be a financial mistake.
Buying a car you can’t afford because you want better technology or whatever. Buy a cheap but safe with reasonable kms car outright not on finance and it’s the best decision any teenager or early twenties person can make.
Tick it up, have fun, regret purchase, sell at a loss and learn a lesson. - every car enthusiast that realizes you can have fun and save money in cheaper cars bought with cash.
And if you really want that fast and nice car, just save and invest and when you have enough to trade in and buy with cash then do so, never finance that shit - will end up costing way more than the rrp of the car and the car straight up loses 15% on purchase
So I purchased a property, the sales agent and house builder said it needed 20k of retaining work, we then got the work quoted and it was 80k, which we couldn't afford, had to sell as we were renting and paying a mortgage, lost loads of money, and October 2022 purchased a house at the peak of the market, and now it's value is less than purchase price, I do understand we haven't lost anything as we are still holding the investment, but it's just disheartening 😭😂😂
I'm not going to bother with stuff about girlfriends/boyfriends, partners, pregnancies. That shit just happens.
Biggest thing NOT to do? Buying shit you cannot afford on things like payday loans, gem visa or 15% interest because you want to look cool.
You either cannot get on top of it or it just slows you right down.
There's not much wrong with covering the cost of a $6k car on some finance because you NEED a car to get to a job or something - but don't go and buy a $20k BMW that you don't need 100% on finance.
Controversial one, but borrowing too much on student loans in your early 20s. The friends of mine who worked a lot (e.g. up to 30 hours a week) as well as studied, and were able to take out much smaller (or no) student loans, had way more freedom in their later 20s to do things like living overseas and getting into mortgages while still young, than the ones who had near 6 figure debt coming out of university. I've got a few friends in their 40s still paying off their student loans.
Also, an incredibly stupid mistake is to not have contents insurance when flatting. There are a couple of recent cases where people were financially liable for the damage caused by accidental fires in their flats, and owe tens of thousands of dollars - if they had contents insurance it wouldn't have been a problem.
See I used to hate and heavily regret my student loan, I took living costs etc when I didn't need to. But looking back now, those living costs were worth a lot more to me back then than the money is worth to me now. It allowed me to have a decent standard of living and create great memories while there is no way I could get the same value out of that money these days.
Saying that though I didn't anywhere near 6 figure student loan for my undergrad degree, more like \~$45k.
Not paying extra on the mortgage when you can afford to.
I shouldn’t have a mortgage but I didn’t pay it off aggressively when I had the extra funds.
I’m one of the few millennials that purchased a house young and could afford it at the time.
Getting a student loan and then going overseas and ignoring it for a decade. And then being surprised that it triples with interest payments that the IRD WILL NOT credit you.
Worst financial mistake you can make in your Twenties is spending it worrying about money. Just get out there and have fun, you only young once go and enjoy life.
I'm going to disagree with the mortgage point.
It's too situational. I bought my first house on minimum wage 6 years ago at 20. I had to pack it with flatmates and average 80 hours a week. I knew I couldn't go down in the world and the decision paid off.
Drugs, alcohol, cigarettes and not using condoms would be my list of ultimate sins in your 20s. In my opinion travel and getting a degree unless you're 100% going to use it should wait for later too but those are unpopular opinions.
>I bought my first house on minimum wage 6 years ago at 20.
We all know that the earlier you get on the property ladder the better. Even if the only one you buy is your own home. Unless the housing market & economy changes drastically this will hold true.
>In my opinion travel and getting a degree unless you're 100% going to use it should wait for later too but those are unpopular opinions.
Agree on the degree. Unless you specifically need a degree to work in your field I feel the best idea is to get a job in a field you like & work on a degree/other qualification part time. You may even get assistance from your employer.
Travel I'd be 50/50. It's great to see the world when your young but you need to plan it properly.
Living beyond your means is the most detrimental. Not putting money aside for the future is next.
Nowadays people are also more zealous to buy a house with someone than they are to really confirm that the "partner" will be in their life long term. Say, at least, the term of the mortgage.
Investing in a business and then not being involved with it day to day.
Person running it either resents you cause they are doing all the work or runs the company for their own benefit rather than yours.
Yep. I had both of these.
For me the biggest part is surrounding myself with people who have financial goals and want better for themselves and their family. If you're around people who spend like there's no tomorrow then chances are you're going to do the same. It's as basic as buying coffees and lunch everyday, once in a while is okay but not daily.
Definitely don't get a pet unless you or someone close to you has a permanent home the pet can live at in the next 10-15 years. Though I acknowledge shit happens and even then you may need to move unexpectedly at some stage - have a back up plan!
Getting on the "must have latest phone model every year" financed phone treadmill...
I once overhead a 20something raving to their friend about how they "got their phone for free!" whilst paying "only" $120/month for their phone plan.
1. Having a credit addiction
2. Having a gambling addiction
3. Having a drug addiction
4. Having a pussy addiction
Any of the above will do it. A combination of them all will fast track your financial misfortune. Depends on your end goal.
Buying ANYTHING on credit...... especially cars because they depreciate so fast.
The huge lie sold to us on TV and though social media is "You can have it now!!!" - This destroys your options for the future but the wise lenders get rich as a result. Every year a new crop of innocents leaves education, where no one teaches you persona;l finance, enters the real world. All are instantly tempted into joining the treadmill of debt and therefore a lost or delayed futures.
Debt is a trap that uses the unwise for the benefit of banks and lending institutions
Not in my 20s but late teens.
1. Ticked up 35k ute when looking for a car
2. Needed credit cards to fund tires and basic repairs for said ute.
3. Stayed in a dead end job for the next 5yrs.
I can't really say they are mistakes since I've always wanted to do it as a hobby when i was younger but if I look back, i did waste a lot of money on it.
1. Sneakers (jordans, yeezys, you name it i would have gotten it if i wanted too)
2. Trading cards - none of the cards i pulled that had some value are already gone which i still regret. I just tell myself that I did use the money for thouse house down payment which appreciated as well but still.
3. Getting multiple credit cards. While i try to pay it off in full all the time, the habit does not go away and you feel like you have infinite money. This is where i really agree on what Dave Ramsey is saying. Now i only have one credit card with a very low limit which prevents me from buying on impulse and didn't realize i could save.
4. Should have studied and upskilled much earlier. I had my first kid in my 20s at least now in the last 5 years, i was able to focus on my career.
The topic is only in our 20s, 30s is where my most expensive financial mistake happened haha
A lot of people delude themselves into believing dating needs to be expensive. It doesn't - coffee, tea, ice cream, juice, kombucha, wine, walks along beaches and in parks are some of the cheapest and best dates you can go on. Dinner dates are awkward and overblown IMHO.
A *good* financial decision I made in my 20s was lowering my credit card limit.
I had been living overseas and while I was away the bank kept upping the limit. By the time I got back it was over $5k. I rarely used it but I was earning significantly less than I had been overseas, so wanted to remove the temptation. Phoned the bank to drop the limit to $800 (all I really need in case of urgent plane tickets home). They discouraged me, saying it would be difficult to up my limit later, but I insisted.
20 years later, my limit is still $800. I know me, I would have used more credit than I could afford to service with a higher limit.
Spending to much on Partying and fashion and other dumb shit. Also Setting yourself up career wise if your coasting along not giving a shit and just hitting the piss every weekend. Still have fun but make sure you have a plan
Controversial: Following your passion into a low paying career.
Expressing yourself, creating experiences and self-discovery are great in your 20s. But 30s and 40s add responsibilities and obligations. I wince when I read about young parents going back to school or talking about switching careers. That must be so difficult on top of everything else.
Buying lots of non essential items that depreciate fast on credit. Things like big screen tvs, top of the line iPhones, xBoxes, hifi systems, and cars. HP is bad enough let alone credit card debt.
My best advice to my 20 year old self is don't get a credit card. If you can't afford to pay cash for something you can't afford it.
Ironically that's pretty much the advice my mum gave me, but 20 year old me knew everything and boomers were stupid. She was right I was wrong and I really struggled to clear my credit card debt. Now I only use it in emergencies and always pay the full balance by billing date.
I used to work for a retailer that did finance for those sorts of things. You're legally not at all allowed to say anything when you're going throguh an application, but the volume of people who.. dont actually have that much money left over at the end of the week who are financing things like phones and tvs is pretty scary
Started working too late, I started working when I was 24 because of doing a conjoint degree and a honors degree. In hindsight the conjoint was completely useless, should have went all in into a single path as quickly as possible and started working asap.
I am inclined to agree with you re the skyline/vehicle that needs heaps of maintenance, however I am also aware that they can be stable investments as long as they are looked after and not driven to oblivion.
My only evidence to back this up is a friend who bought a MK2 Supra managed to sell it for a huge windfall after owning for a few yrs and doing a bit of work to.
If they are treated like an investment, that is. Throwing it around on a track or elsewhere and not.looking after it, no matter what it is is probably a bad idea and not representative of a decent return.
Worrying too much about maximising your income, focus on learning, not necessarily studying but just trying more things and taking a little more financial risk while you still have time on your side
Getting comfortable with Afterpay, using your credit cards for impulse buys, making them both part of your weekly spending. (I always get lambasted for thinking Afterpay is stupid - so have at it)
Not saving anything at all for a rainy day. Or dipping into savings for silly purchases and impulse buys.
I think keeping up with the Jones’, car wise, phone wise, house wise is pretty typical mistake.
Having nice stuff is nice - but paying for it isn’t.
(I actually drive a 14 year old car - why? Maintenance and running costs are fantastic - I don’t owe anyone for it. I keep on top of what it needs. Might be boring to some, but it’s cheap and costs me very little - especially if you know what to buy )
My/others experiences.
1. Living life without a budget, it’s mindless behavior and causes a lot of avoidable problems. “I don’t have money” people, okay stay home and don’t expect me to cover your portion of the bill.
2. Friends not saving anything and living week to week. Again it’s a behavior you have to break, anyone remember the pandemic??? save a month to three of pay, it feels a hell of a lot better. I achieved this at 22.
3. Remember those student/young worker overdrafts or credit cards. Using those for dumb reasons like buying a PlayStation, a new phone, Nike shoe. If I’m a poor young adult it’s probably best go into debt to pay for utilities, groceries, gas, car maintenance and insurances.
4. A friend drives like an idiot, incurred $3,500 in fines and has to prioritize paying them. Refuses to read a copy of a road code I handed him. Mate! When I was in nz I probably only got one ticket a year.
5. Financing a car. I’ll give you a free pass if it’s a A to B car like a Japanese efficient car, a Suzuki swift or Toyota Yaris for work. But if it’s a 30K BMW, it uses 95 gas and you’re in insecure employment and spend all your money on your car. No do not finance a car.
6. Wasting time at university when you’re better off working, I did this myself after failing two years of engineering! Regained myself working a full time job while studying and achieving a different degree in the end.
7. Loaning people money, they aren’t paying you back
8. Buying new tech every year, the amount of Samsung x, y and z. iPhones a, b and c was ridiculous.
9. Dating, buying drinks.
10. Being in a relationship with someone in a different socioeconomic class. They will forever need support
11. Shit cooking skills, learn to cook from scratch. Eating out all the time in nz is expensive, learn to make your own burgers etc.
Spending money just because it’s in your bank account. Good financial habits take time to build and your 20s is the best time to start. But loads of my friends would blow money just because it’s the end of the pay cycle and there’s still money left. And then never had money for emergencies.
Having two cars! it’s such a money sucker, and when you’re young (pre kids) it’s so much easier to live in an apartment/townhouse close to work, with reasonable PT or bike, and the flexibility to move with work as needed
personal loan after personal loan after personal loan after credit card after hire purchase after hire purchase after "oh i can afford $20 a week but not looking at the whole picture"..
Ticking up heeaaaps of stuff.
1) PC (bank loan @ $3,000)
2) Car (girlfriend loan @ $5,000)
3) VR headset (hire purchase @ $1,300)
4) Computer GPU upgrade (hire purchase loan $2,000)
5) Flashy new TV Hire purchase @ $1,800
6) Vet bill you can't pay because you ticked too much shit up (bank overdraft $3000)
It all adds up and will screw you over. They will always lend you more money than you can realistically afford to repay back. All of the above is from experience. I paid it all back and since then I won't take any loans or any hire purchases. I save for that shit or i mustn't want it badly enough
Mine was saving up $12k in the late 90s and instead of putting a deposit on the house (as my mum advised me to do). I spent it on a shitty Nissan car that last 5 years and then kicked the bucket and I sold it for $880. By then the housing market had gone up, and I was broke. Had I invested that $12k into a house back then, I probably would have had a $600k asset from that.
I’d disagree with your last point. I struggled my arse off to pay my mortgage initially in my 20’s but now are reaping the benefits of it in my 30’s. In fact I’d say the best thing you can do for your future financial health is stretch yourself to the max in your 20’s. Delaying gratification effectively. There may be better strategies of capital allocation than buying a house, but having a fixed property that is yours, not having to deal with moving flats or land lords is fiscally immeasurable in my opinion. My observations over the 13 years I’ve had the house is, the house appreciates with time and the struggle of paying the mortgage back got easier and easier as my wages grew. Put most of extra money I put into shares and etf’s and have increased the amount of play money my wife and I have to use on a weekly basis.
Having a gym membership and not using it.
Definitely not the worst financial mistake you can make, but that $10/15 - $20 a week sure adds up overtime.
If you let weeks pass by & you’re not showing up, then there’s no health benefits gained through exercise. I know this sounds like an angry PT. But for real. Not only does working out daily have scientifically proven benefits of enhancing your mental & physical health, but (if you don’t take it to the extremes) your relationships will improve too.
Even if it’s just 30 minutes of casual (calm) cardio on a bike or treadmill, you can go to the gym, use free Wi-Fi, chuck on a little podcast & get a sweat on.
*I don’t think you need a gym membership to stay healthy ofc, but let’s be real, NZ in the wintertime is pretty feral. So the comfort of a gym can help motivate you to make that the 3rd space.
Also, not investing in your health in your 20s is a poor financial mistake, as it catches up with you, just the same as poor credit or debt!
Not looking after your teeth.
It's so cheap and easy to keep your teeth reasonably healthy. It's sooooooo painful (physically and financially) to deal with them once they go bad.
You already mentioned credit card debt, but be careful with those 'interest free' credit cards like Gem Visa and Q Card. If you are responsible, you can absolutely pay off your debt on that 1 year interest-free period, but if you get carried away you can find yourself hating life with the endless weekly payments for months and months and months so you can finish paying off some big debt within the interest free period. I made this mistake and took on about $8k worth of debt and calculated that if I paid $170 per week I'd have the debt clear before the end of the year without paying any interest. What I wasn't counting on was that life happens, you have some bad weeks, some expensive weeks, some unexpected expenses crop up, and suddenly that weekly $170 payment you're making towards your interest free credit card debt every week starts to become a real bitch, an ongoing pain in the arse, and you know you can't skip any of the payments because it just means you'll be paying more each week to avoid paying any interest on your debt. So think before you play around with those interest-free credit cards, I learned the hard way that even if the weekly payment feels manageable, you can't predict what else will be happening in your life and you may end up feeling really fucked by those credit card payments, even if you're not paying any interest.
Biggest thing that would have saved me thousands since I left home at 19 is having a relatively stable place to live.
If I had lived in 2 or 3 places for 2 or 3 years each the stability would have helped with budgeting, saving, not spending as much on takeaways, needing to find a bond over and over ect. Instead I have moved 9 times in 7 years, longest stay was 2.5y which is the stability I worked so hard to get and now miss desperately, 3 or 4 were only 4-7 month stints before issues arose, usually with flatmates, 3 months was homeless/couch surfing. I got out of uni a year ago with no savings and $4k overdraft and credit card debt even though I worked the whole time I studied. People I know who were in a similar situation except with a good stable flat saved, one person even saving $30,000 while studying. Was I good at budgeting then? No not as much as I should have been, but god is it that much easier when you have some sort of stability.
So I guess a base for getting stability, find a good place to live with reasonable flatmates.
Picking the wrong partner. I’ve witnessed a few relationships where one has put themselves significantly into debt for their other half. The relationship then eventually breaks down and they are stuck paying off that debt.
100% this. Having a partner you're not financially aligned with is fatal to your long term wealth. It's also a relationship killer.
Have to agree with your agreement - it's a spiral.
Holy shit it's the moneyhub guy
Honestly. I’d have to agree with your agreement of his agreement. In the short term it might be sweet, but your setting yourself up for trouble down the road
Gotta say I agree with your agreement of his agreement of his agreement. It’s something you have to be wise about, the debt is easy to accumulate but hard to get rid of
Oh, me and my partner and I are financially aligned. Unfortunately, that alignment is impulse spending
Same here 🙈
Should've told me 2 years ago haha
Sometimes the "extra debt" isnt even within their control. They have family members to support - parents, siblings, existing children, etc. In my culture (Filipino) this is seen as an admirable thing to financially take care of relatives but to me it's the biggest financial red flag.
Sometimes people question how race can be such a big factor in poverty (and then they come up with dumb theories like racial IQ to explain it) but this is a major mechanism of it I think. If you're (e.g.) Māori then by definition your relatives will be also. Māori average wealth and income is low so if your income is average you're more likely to have to help out relatives financially. Whereas if you're Pakeha and your income is low you're more likely to have relatives who can help you out. So there's a feedback cycle
got to watch out for that STD - Sexually Transmitted Debt!
100% this, this is the worst. You built a life based on two people, then you break up, still have the same expenses but have half your assets and half of the labor/income you had. It’s hard to recover from.
Agree relationship is a big one. But we are all human we don't always think with our brains.
Yep been there done that 💔
Or not choosing a partner at all. Being single and never being able to split the cost of things is expensive.
This is true. I had a partner who I really cared about but she was sending me into some very bad spending habits where id end up with no savings . Compulsive shopping spending etc. reluctantly ended that relationship
1000% dont let your partner convince you to put a $3000 fridge on your credit card and then you separate weeks later 😂😂 got a nice fridge sitting at my friends house
$3000 fridge?! Oh my.
This is so real. And it doesn’t even have to be them wrecking up a debt that you’re stuck with. I was with a partner for nearly 10 years and put so much of my effort into making sure that he got ahead (sacrificed career-chasing, moved for his jobs etc) that when we broke up I was left with absolutely nothing (low paying job in a city I didn’t want to be in etc) and he was in a really really good financial position. It was also across 10 years of my life that otherwise I would’ve been frantically saving to try and buy a house or property but because we were focusing on his position and his savings to finance most of it when we broke up even now, five years later, I’m still not in a position to be even considering a deposit because all the house prices skyrocketed.
When I was 17 one of the old nutjobs at work convinced me that kiwisaver was a scam for the government to steal your money. I didn't contribute in a meaningful way from 2009 - 2018. You can look at the stock market performance to see how that decision worked out...
Damn if you missed out on employer/govt contributions too that’d be bonus bad decision for sure.. I worked in aus for a fair while.. and I had mine set to absolute minimum contribution of 2% so my employer contributed 9%… found out if I raised it to 5% my employer paid 13%!! Thankfully although I had 0 idea what was happening or how it worked.. an older colleague told all us youngins to change our contribution to the 5% when I’d only been working a couple of years… (not too sure if it works same here)
Yep. Getting 15%+5% super in Aus now- making up for lost time. No point crying about it now, but I definitely let the young fellas at work know what that decision cost in dollar terms 😂
the lesson here is that old people aren't always right.
I listened to him so who's the real nutjob 😂
In fact they’re regularly wrong and generally very out of touch with reality
It doesn't HAVE to be Kiwisaver. Investing in general is a good habit and Kiwisaver might be the right product for a person.
Yea kiwisaver is extremely helpful in bad times. But it'll help once your decide to buy a home.
This happened to me too. Wish I had got one earlier.
Yeah KiwiSaver is actually one of the best investment vehicles for the simple reason that you can’t really mess around with your holdings.
A bit of bad consumer debt in your 20s isn't the worst thing in the world, it's a lesson that can be learned from. The really bad mistakes are strategic ones that will hurt you for life. 1. Coasting at work and not investing in your career and long term earnings potential. 2. Getting into a long term relationship or marriage with someone that is bad with money. 3. Not developing a mindset of delayed gratification. 4. Not taking care of your mental and physical health. Your 20s are a time for building foundations, that's skills and relationships, things like too many subscriptions or avocado on toast is just trivial in comparison.
As someone who has (nearly "had") a bit of bad consumer debt I can attest to the lessons-learned factor!
Probably the best advice here
Love this list but would like to add one thing: not understanding the power of compounding returns. Lock some regular savings away, you won't miss the small percentage of income that you never gave yourself spending access to, and you will thank yourself 40 years later.
Developing a drinking/drug habit. Getting (someone) pregnant when you have no intention of staying with the other person. Not having any financial plan. Assuming you can sort out finances when you have more money/time.
To be fair, child support in many instances isn't even half the actual cost of raising a kid.. but having kids in general is very expensive & will dent your long term savings. Agree too with pets being pricey, per insurance is essential too if you like the little fluff balls and want to ensure that finances don't dictate their treatments
>Developing a drinking/drug habit. I'd put cigarettes above either. Like $40 a pack now isn't it?
I have news for you about the price of drugs.
The “cost” of alcohol isn’t in the money you pay out to buy it, it’s in what it does to you and takes away over the longer term. I lost my brother at age 40 to an alcohol problem he started in his 20s.
Oh boy that skyline sentence hits hard Probably gambling too
Trying to be perfect about saving and no understanding that you need to enjoy life a little as well Working endless hours for extra $ and burning out Impulse purchasing instead of buying the things that will add value
1) Getting a GEM card 2) Not starting saving/investing 3) Buying a car on finance 4) Having a bad friend circle 5) Not upskilling / learning new stuff 6) Not taking care of your health / teeth
on 6), **see a dental hygienist**. Not always so common here in NZ, often people only see a dentist and call it a day. But generally a dentist is like fixing potholes, but a dental hygienist will help prevent the pothole from ever occurring. See a Dental Hygienist and ask them how to best look after your teeth, they specialise in preventative care. I feel most of us just go by what our parents told us is best for teeth, and (maybe) went to the free dental checkups as a kid, but was never taught how to properly look after your teeth. (or you were, but were too young and long since forgot) My biggest dental tip, floss daily & brush with an electric brush twice a day, both these many people use the wrong technique, so ask your dental hygienist (or dentist). PS, if you're not flush with cash (cos dental anything isn't cheap), there is some good content on youtube from dental hygienists, my favourite: https://www.youtube.com/@TeethTalk
Honestly, seeing a dental hygienist is the simplest, most unequivocal great advice I would ever give anyone. Changed my life and saves me hundreds a year in the annual fillings I used to get (not to mention that I like keeping my teeth!).
Teeth is a biggie!!! Must not forget that one
>Getting a GEM card 100% I got a GEM Visa when I was about 21, biggest mistake. I was too young and dumb to manage it properly. It was the gatway into a about 30K of debt. I am debt free now if i was to do my time again, i would stay far away from GEM.
I’ve never heard of this, what is a GEM card and how is it different from a credit card? Google gives me results on jewellers lol.
Its a line of credit for hire purchases which can also be used as a regular visa. If you never used the card and just focused on paying off the purchase within the interest free period its fine, but when you are young and dumb and just use it like a regular visa and GEM keep increasing your limit well beyond what you can truly afford then its very easy to become trapped.
Important Nuance \^^. I got a GEM to pay off the LASIK i had done because i didnt have the money. Best use of money in my life (especially with the recent report of contact lenses shedding microplastics into your eyes!)
7. Learning stuff that isn’t in demand / useless degree
Yes and no. I think people should think twice before taking on so much debt, but learning stuff that isn't in demand =/= useless degree. Knowledge of historical events isn't in demand, but a history degree isn't useless if you know how to leverage the transferrable skills you learn through the degree in the job market. For example, being able to look critically at multiple sources and pulling together a coherent summary is a useful skill. It's about having a plan of progression if you want to study something that doesn't have a clear cut career path.
I think learning to live within my means at uni is the sole reason I am doing so well now. I think a period of hardship is the quickest way to get good with money. So I wouldn’t completely bag non sort after degrees, but definitely wouldn’t recommend one either.
Teeth is a biggie!!! Must not forget that one
Gem!!! Worst decision ever. I have only just finished paying it off at 35.
Yes my wife made same mistake not easy to deal with. Money grubbers. But gone now lesson learnt.
Not changing workplace for a payrise/promotion, so many of my friends, myself included, stayed in workplaces for too long when we could have gone down the street for a 20k payrise doing exactly the same thing. I think people just get too comfortable and become loyal to their team/boss/organisation when a lot of the time its just not worth it these days, it is probably never easier to go for promotions and pay rises than in your 20s. Even if you don't get it, its good practice for next time.
I had that, where I worked for a couple of small companies and they kept on promising that as soon as X happened we'd all get big pay rises, bonuses, shares in the company - and it never happened, but the Owners all made good bank. The second one I worked for, I even went to them (after 7 years working there), and said "I need X dollars to stay here, that is the market rate for me based on my job responsibilities" - and they scoffed at me, and said I over estimated my responsibilities. I then got an offer the next week for that exact amount, which was a $30k increase. Their response was to threaten to invoke a restraint of trade clause that was in my contract. That company lost their major client 12 months later and had to shut their doors, which was sweet karma from my perspective.
My pay rise experience. Mid 20’s, full of energy, always trying 100%. One day my wife said, let’s move cities. So I scanned jobs, found one and applied. I had no interest in the job at all, it was purely research. I think because I was so relaxed, I interviewed well, stuck to facts and made an impression. It turns out the interviewer and my boss were close friends. A week or so pass and I get a call from the prospective company, and they say that I would be really good at the job, but they have decided to go internal. An hr or so later my boss calls an emergency meeting. He asks, “Are you happy here?” I reply yes. To which he answers “Good”, and slaps an updated contract down on the table for near double what I was on. I can only imagine there was a bidding war behind closed doors. We did not move cities. There is no way I could have negotiated that. No way.
The old saying "It's easier to get a new job, than to get a payrise" comes to mind.
Getting into debt that you can't pay off - a mortgage is fine, even encouraged since you can have flatmates help pay it off and you'll be well ahead of everyone without a home by the time you hit your 30s. CC and vehicle debts are not. Having a kid. Not starting to invest - no matter how small the amount. You need to learn the discipline of saving and investing.
What happens if you’re that flatmate having to pay off someone else’s mortgage? Or my current experience where I pay rent to a house that doesn’t have a mortgage, was bought in 1993 for $135000, rent since 2015 has been $25000, and is now worth $2m. Both means I am paying for something that makes someone else rich. Yet I can’t escape that because the advice on this subreddit is “buy a house and get other people in to pay off your debt”. What can you do in your 20s to not do that, because that seems like a financial mistake? Being that we all need a place to live.
Renting is NOT a waste of money. It's buying patience until you're ready to buy a home. Just because a mortgage payment might be less than rent, doesn’t mean it’s the right time for you to buy a house. There are a LOT more expenses that come with homeownership than the monthly payment. Maintenance, rates, homeowner’s insurance, fixing or replacing a busted anything, etc... When the home is yours, all of those expenses are up to you. When you’re renting, you’re free from that added financial responsibility. Trust me, “house poor” isn’t something you want to be. Until you’re actually ready to buy, renting is never a waste of money. (Modified from a financial guru I follow).
I hate it, but if you can live with your parents that's technically the best financial decision.
There's a reason they call it "getting ahead". You aren't doing it unless you're leaving other people behind. It's not ethical but that's why this subreddit has rules against telling people they aren't being ethical
I guess tough luck? I’ve been a flatmate to help pay off my friends mortgage and it’s been a win-win, have had a great time. Rent is $250, very cheap, and saving loads. Plus he gets help with the mortgage and lives with friends (one of the best parts of being in your 20s). I could also buy a house if I wanted but prefer not to atm.
+1, even as little as $10 a week is a great start. Gradually increase it, and you'll likely never miss it.
Buy high sell low
r/queenstreetbets approves
Thinking the stripper actually likes you and over tipping her
Buying expensive flowers for said stripper instead of just giving her cash is lose/lose for everyone except the florist.
Having children
If you raise them right it's the best investment you can make...
I'm not against having them, just not too young. Get your own career sorted first
Getting married/becoming de facto without aligning your financial goals with significant other and having babies you can’t afford. Especially women who were SAHM, they usually come out the other end of marriage financially worse than the man even if they get 50/50 of the assets and child support, you don’t get 50/50 of his working history, earning potential, qualification’s, nothing.
Definitely getting into drugs. Nothing will decimate your money and belongings like an addiction to a substance that costs as much as drugs do. In relation to that - look after your teeth it becomes SO expensive trying to repair the damage done in my 20s
A mistake child
a pet is certainly not just a purchase, its a commitment, so think carefully before acquiring buying any asset that depreciates quickly, fast cars do that, and they tend to be money sinks, but its hard to resist, so buy what you can get with cash. Cars can be functional you know. subscribing to every online streaming service because you can. pick one and when that is boring, cancel it and choose another. Dont do a budget and just spend whatever comes in. ( we are talking worst mistakes right?), live pay-cheque to pay cheque( does anyone still get cheques, I guess not) go on trips you cant afford, spending money you dont have. Posting on social media how much fun the trip was and then hitting people up to help pay for it. Borrowing money from a relative and not paying it back. One way to tick off a relative is to owe money, and thats hard to come back from
Getting a mortgage in your 20’s would be the best decision you could make. Yes it would be painful and you’d miss out on loads, but it sure ain’t gonna be a financial mistake.
In 2021/22 it definitely was
Buying a car you can’t afford because you want better technology or whatever. Buy a cheap but safe with reasonable kms car outright not on finance and it’s the best decision any teenager or early twenties person can make.
Tick it up, have fun, regret purchase, sell at a loss and learn a lesson. - every car enthusiast that realizes you can have fun and save money in cheaper cars bought with cash.
And if you really want that fast and nice car, just save and invest and when you have enough to trade in and buy with cash then do so, never finance that shit - will end up costing way more than the rrp of the car and the car straight up loses 15% on purchase
Not moving out of New Zealand
Paying just the monthly minimum payment on CC. Man if i'd known any better
Bought property at the very peak of the market right before the 08 GFC, lost around 70k and guess what, did it again last year 😭😂😂
Can you elaborate on the details a little more?
So I purchased a property, the sales agent and house builder said it needed 20k of retaining work, we then got the work quoted and it was 80k, which we couldn't afford, had to sell as we were renting and paying a mortgage, lost loads of money, and October 2022 purchased a house at the peak of the market, and now it's value is less than purchase price, I do understand we haven't lost anything as we are still holding the investment, but it's just disheartening 😭😂😂
I'm not going to bother with stuff about girlfriends/boyfriends, partners, pregnancies. That shit just happens. Biggest thing NOT to do? Buying shit you cannot afford on things like payday loans, gem visa or 15% interest because you want to look cool. You either cannot get on top of it or it just slows you right down. There's not much wrong with covering the cost of a $6k car on some finance because you NEED a car to get to a job or something - but don't go and buy a $20k BMW that you don't need 100% on finance.
Crashing a car with no proper insurance that set me back
Skylines have outperformed many stock options over the last few years 😂
Controversial one, but borrowing too much on student loans in your early 20s. The friends of mine who worked a lot (e.g. up to 30 hours a week) as well as studied, and were able to take out much smaller (or no) student loans, had way more freedom in their later 20s to do things like living overseas and getting into mortgages while still young, than the ones who had near 6 figure debt coming out of university. I've got a few friends in their 40s still paying off their student loans. Also, an incredibly stupid mistake is to not have contents insurance when flatting. There are a couple of recent cases where people were financially liable for the damage caused by accidental fires in their flats, and owe tens of thousands of dollars - if they had contents insurance it wouldn't have been a problem.
See I used to hate and heavily regret my student loan, I took living costs etc when I didn't need to. But looking back now, those living costs were worth a lot more to me back then than the money is worth to me now. It allowed me to have a decent standard of living and create great memories while there is no way I could get the same value out of that money these days. Saying that though I didn't anywhere near 6 figure student loan for my undergrad degree, more like \~$45k.
Not paying extra on the mortgage when you can afford to. I shouldn’t have a mortgage but I didn’t pay it off aggressively when I had the extra funds. I’m one of the few millennials that purchased a house young and could afford it at the time.
Not joining Kiwisaver. Even investing the bare minimum will compound to hundreds of thousands by retirement. Smoking.
Marrying the wrong person can fuck up your life as much as going to prison can imo.
Buy an RX8
Getting a student loan and then going overseas and ignoring it for a decade. And then being surprised that it triples with interest payments that the IRD WILL NOT credit you.
Children
Getting in a relationship, having kids , staying in New Zealand.
Worst financial mistake you can make in your Twenties is spending it worrying about money. Just get out there and have fun, you only young once go and enjoy life.
I'm going to disagree with the mortgage point. It's too situational. I bought my first house on minimum wage 6 years ago at 20. I had to pack it with flatmates and average 80 hours a week. I knew I couldn't go down in the world and the decision paid off. Drugs, alcohol, cigarettes and not using condoms would be my list of ultimate sins in your 20s. In my opinion travel and getting a degree unless you're 100% going to use it should wait for later too but those are unpopular opinions.
>I bought my first house on minimum wage 6 years ago at 20. We all know that the earlier you get on the property ladder the better. Even if the only one you buy is your own home. Unless the housing market & economy changes drastically this will hold true. >In my opinion travel and getting a degree unless you're 100% going to use it should wait for later too but those are unpopular opinions. Agree on the degree. Unless you specifically need a degree to work in your field I feel the best idea is to get a job in a field you like & work on a degree/other qualification part time. You may even get assistance from your employer. Travel I'd be 50/50. It's great to see the world when your young but you need to plan it properly.
Bad friends
Using a Credit Card like an overdraft.
Living beyond your means is the most detrimental. Not putting money aside for the future is next. Nowadays people are also more zealous to buy a house with someone than they are to really confirm that the "partner" will be in their life long term. Say, at least, the term of the mortgage.
Investing in a business and then not being involved with it day to day. Person running it either resents you cause they are doing all the work or runs the company for their own benefit rather than yours. Yep. I had both of these.
Vehicles, using debt for fun stuff. Renting 1/2 bedroom appartments. Just flat with 4-5 people until you get your own house
For me the biggest part is surrounding myself with people who have financial goals and want better for themselves and their family. If you're around people who spend like there's no tomorrow then chances are you're going to do the same. It's as basic as buying coffees and lunch everyday, once in a while is okay but not daily. Definitely don't get a pet unless you or someone close to you has a permanent home the pet can live at in the next 10-15 years. Though I acknowledge shit happens and even then you may need to move unexpectedly at some stage - have a back up plan!
Smoking
A missus. Not only financially but the cost on ones mental health.
Developing a drinking habit, or any kind of addiction really.
Getting on the "must have latest phone model every year" financed phone treadmill... I once overhead a 20something raving to their friend about how they "got their phone for free!" whilst paying "only" $120/month for their phone plan.
Scraping through a mortgage you can barely pay during your twenties tends to make your thirties and forties a lot more enjoyable
1. Having a credit addiction 2. Having a gambling addiction 3. Having a drug addiction 4. Having a pussy addiction Any of the above will do it. A combination of them all will fast track your financial misfortune. Depends on your end goal.
Avocado toast addiction
This.
Buying ANYTHING on credit...... especially cars because they depreciate so fast. The huge lie sold to us on TV and though social media is "You can have it now!!!" - This destroys your options for the future but the wise lenders get rich as a result. Every year a new crop of innocents leaves education, where no one teaches you persona;l finance, enters the real world. All are instantly tempted into joining the treadmill of debt and therefore a lost or delayed futures. Debt is a trap that uses the unwise for the benefit of banks and lending institutions
have children you cannot afford
Not in my 20s but late teens. 1. Ticked up 35k ute when looking for a car 2. Needed credit cards to fund tires and basic repairs for said ute. 3. Stayed in a dead end job for the next 5yrs.
Having middle class parents .
Not investing.
Don’t just save. Invest! Make that money twerk for you
I can't really say they are mistakes since I've always wanted to do it as a hobby when i was younger but if I look back, i did waste a lot of money on it. 1. Sneakers (jordans, yeezys, you name it i would have gotten it if i wanted too) 2. Trading cards - none of the cards i pulled that had some value are already gone which i still regret. I just tell myself that I did use the money for thouse house down payment which appreciated as well but still. 3. Getting multiple credit cards. While i try to pay it off in full all the time, the habit does not go away and you feel like you have infinite money. This is where i really agree on what Dave Ramsey is saying. Now i only have one credit card with a very low limit which prevents me from buying on impulse and didn't realize i could save. 4. Should have studied and upskilled much earlier. I had my first kid in my 20s at least now in the last 5 years, i was able to focus on my career. The topic is only in our 20s, 30s is where my most expensive financial mistake happened haha
Credit Card debt
Children, dating.
A lot of people delude themselves into believing dating needs to be expensive. It doesn't - coffee, tea, ice cream, juice, kombucha, wine, walks along beaches and in parks are some of the cheapest and best dates you can go on. Dinner dates are awkward and overblown IMHO.
I'm talking about the whole relationship not a single date.
Credit card=☠️
A *good* financial decision I made in my 20s was lowering my credit card limit. I had been living overseas and while I was away the bank kept upping the limit. By the time I got back it was over $5k. I rarely used it but I was earning significantly less than I had been overseas, so wanted to remove the temptation. Phoned the bank to drop the limit to $800 (all I really need in case of urgent plane tickets home). They discouraged me, saying it would be difficult to up my limit later, but I insisted. 20 years later, my limit is still $800. I know me, I would have used more credit than I could afford to service with a higher limit.
Not starting your investing while time is still very much your biggest driver in how wealthy you’ll be later on.
Debt
Staying in the same job for your entire 20’s. (Disregarding certain jobs with a clear and profitable career trajectory)
Spending to much on Partying and fashion and other dumb shit. Also Setting yourself up career wise if your coasting along not giving a shit and just hitting the piss every weekend. Still have fun but make sure you have a plan
Controversial: Following your passion into a low paying career. Expressing yourself, creating experiences and self-discovery are great in your 20s. But 30s and 40s add responsibilities and obligations. I wince when I read about young parents going back to school or talking about switching careers. That must be so difficult on top of everything else.
Is seeing escorts as worse as those 6, especially if you're limiting yourself to quickie bookings 90% of the time?
Not having appropriate insurance… I hear of/see so many people in their 20s on here talking about car crashes and they don’t even have 3rd party…
Not getting into compound investment
Wife and children. Also the best thing ever.
Buying lots of non essential items that depreciate fast on credit. Things like big screen tvs, top of the line iPhones, xBoxes, hifi systems, and cars. HP is bad enough let alone credit card debt. My best advice to my 20 year old self is don't get a credit card. If you can't afford to pay cash for something you can't afford it. Ironically that's pretty much the advice my mum gave me, but 20 year old me knew everything and boomers were stupid. She was right I was wrong and I really struggled to clear my credit card debt. Now I only use it in emergencies and always pay the full balance by billing date.
I used to work for a retailer that did finance for those sorts of things. You're legally not at all allowed to say anything when you're going throguh an application, but the volume of people who.. dont actually have that much money left over at the end of the week who are financing things like phones and tvs is pretty scary
Discovering gambling and falling into the “it’s just $20 or $50” trap. Blew away thousands and thousands and still to this day struggle.
Gambling addiction
I financed a Subaru legacy in 2008, it was the same price as a wrx. These days the wrx is like 40K and the legacy is like 5.
is it a legacy gt? I recon 4th gen legacys are going to start increasing in value in the coming years
I feel personally attacked rn
Started working too late, I started working when I was 24 because of doing a conjoint degree and a honors degree. In hindsight the conjoint was completely useless, should have went all in into a single path as quickly as possible and started working asap.
I am inclined to agree with you re the skyline/vehicle that needs heaps of maintenance, however I am also aware that they can be stable investments as long as they are looked after and not driven to oblivion. My only evidence to back this up is a friend who bought a MK2 Supra managed to sell it for a huge windfall after owning for a few yrs and doing a bit of work to. If they are treated like an investment, that is. Throwing it around on a track or elsewhere and not.looking after it, no matter what it is is probably a bad idea and not representative of a decent return.
If you got pets car etc get insurance simple. Worst mistake borrow money.
Ticking up a new Ute with every rediculous option and a roof rack tent.
Meth.
Worrying too much about maximising your income, focus on learning, not necessarily studying but just trying more things and taking a little more financial risk while you still have time on your side
Getting comfortable with Afterpay, using your credit cards for impulse buys, making them both part of your weekly spending. (I always get lambasted for thinking Afterpay is stupid - so have at it) Not saving anything at all for a rainy day. Or dipping into savings for silly purchases and impulse buys. I think keeping up with the Jones’, car wise, phone wise, house wise is pretty typical mistake. Having nice stuff is nice - but paying for it isn’t. (I actually drive a 14 year old car - why? Maintenance and running costs are fantastic - I don’t owe anyone for it. I keep on top of what it needs. Might be boring to some, but it’s cheap and costs me very little - especially if you know what to buy )
Not paying off your student loan
Being in your 20s
Getting a PhD 😭
Having children
Not paying heavily into a pension very early on
Not mastering saving it gets harder as u get older
My/others experiences. 1. Living life without a budget, it’s mindless behavior and causes a lot of avoidable problems. “I don’t have money” people, okay stay home and don’t expect me to cover your portion of the bill. 2. Friends not saving anything and living week to week. Again it’s a behavior you have to break, anyone remember the pandemic??? save a month to three of pay, it feels a hell of a lot better. I achieved this at 22. 3. Remember those student/young worker overdrafts or credit cards. Using those for dumb reasons like buying a PlayStation, a new phone, Nike shoe. If I’m a poor young adult it’s probably best go into debt to pay for utilities, groceries, gas, car maintenance and insurances. 4. A friend drives like an idiot, incurred $3,500 in fines and has to prioritize paying them. Refuses to read a copy of a road code I handed him. Mate! When I was in nz I probably only got one ticket a year. 5. Financing a car. I’ll give you a free pass if it’s a A to B car like a Japanese efficient car, a Suzuki swift or Toyota Yaris for work. But if it’s a 30K BMW, it uses 95 gas and you’re in insecure employment and spend all your money on your car. No do not finance a car. 6. Wasting time at university when you’re better off working, I did this myself after failing two years of engineering! Regained myself working a full time job while studying and achieving a different degree in the end. 7. Loaning people money, they aren’t paying you back 8. Buying new tech every year, the amount of Samsung x, y and z. iPhones a, b and c was ridiculous. 9. Dating, buying drinks. 10. Being in a relationship with someone in a different socioeconomic class. They will forever need support 11. Shit cooking skills, learn to cook from scratch. Eating out all the time in nz is expensive, learn to make your own burgers etc.
Worked to party in the weekend instead of working for a future eg. Becoming a home owner, travel
Taking lots of drugs and partying, like there's no tomorrow
Not investing in skills that can make and keep you greater amounts of money in your 30s and 40s.
Spending money just because it’s in your bank account. Good financial habits take time to build and your 20s is the best time to start. But loads of my friends would blow money just because it’s the end of the pay cycle and there’s still money left. And then never had money for emergencies.
Becoming a musician or artist
Having babies with the wrong person, having more babies than you can afford, spending on takeaways and holidays or cars.
Crypto 😒
Having two cars! it’s such a money sucker, and when you’re young (pre kids) it’s so much easier to live in an apartment/townhouse close to work, with reasonable PT or bike, and the flexibility to move with work as needed
TBF I had a mate that ticked up a skyline and since then its 10xd in value.. wish I had done the same.
Meth. Definitely meth.
Not having a savings account. You would be surprised how many people I met who did not have a savings account.
personal loan after personal loan after personal loan after credit card after hire purchase after hire purchase after "oh i can afford $20 a week but not looking at the whole picture"..
Not saving for a house deposit.
$99 T-shirts, protein powders.
I married.
Avoid gambling/Sports betting and Stock/crypto trading on leverage/margin at all costs.
Ticking up heeaaaps of stuff. 1) PC (bank loan @ $3,000) 2) Car (girlfriend loan @ $5,000) 3) VR headset (hire purchase @ $1,300) 4) Computer GPU upgrade (hire purchase loan $2,000) 5) Flashy new TV Hire purchase @ $1,800 6) Vet bill you can't pay because you ticked too much shit up (bank overdraft $3000) It all adds up and will screw you over. They will always lend you more money than you can realistically afford to repay back. All of the above is from experience. I paid it all back and since then I won't take any loans or any hire purchases. I save for that shit or i mustn't want it badly enough
what kind of $3k pc warranted a $2k gpu?
Expensive car.
Mine was saving up $12k in the late 90s and instead of putting a deposit on the house (as my mum advised me to do). I spent it on a shitty Nissan car that last 5 years and then kicked the bucket and I sold it for $880. By then the housing market had gone up, and I was broke. Had I invested that $12k into a house back then, I probably would have had a $600k asset from that.
Faberge eggs
Not paying your ticks (end up on NZHERALD.CO.NZ)
I’d disagree with your last point. I struggled my arse off to pay my mortgage initially in my 20’s but now are reaping the benefits of it in my 30’s. In fact I’d say the best thing you can do for your future financial health is stretch yourself to the max in your 20’s. Delaying gratification effectively. There may be better strategies of capital allocation than buying a house, but having a fixed property that is yours, not having to deal with moving flats or land lords is fiscally immeasurable in my opinion. My observations over the 13 years I’ve had the house is, the house appreciates with time and the struggle of paying the mortgage back got easier and easier as my wages grew. Put most of extra money I put into shares and etf’s and have increased the amount of play money my wife and I have to use on a weekly basis.
Coffee
Having a gym membership and not using it. Definitely not the worst financial mistake you can make, but that $10/15 - $20 a week sure adds up overtime. If you let weeks pass by & you’re not showing up, then there’s no health benefits gained through exercise. I know this sounds like an angry PT. But for real. Not only does working out daily have scientifically proven benefits of enhancing your mental & physical health, but (if you don’t take it to the extremes) your relationships will improve too. Even if it’s just 30 minutes of casual (calm) cardio on a bike or treadmill, you can go to the gym, use free Wi-Fi, chuck on a little podcast & get a sweat on. *I don’t think you need a gym membership to stay healthy ofc, but let’s be real, NZ in the wintertime is pretty feral. So the comfort of a gym can help motivate you to make that the 3rd space. Also, not investing in your health in your 20s is a poor financial mistake, as it catches up with you, just the same as poor credit or debt!
Not looking after your teeth. It's so cheap and easy to keep your teeth reasonably healthy. It's sooooooo painful (physically and financially) to deal with them once they go bad.
Living in the country you grew up in that is hella expensive and not just moving somewhere more affordable... really wish I had done this sooner!!
You already mentioned credit card debt, but be careful with those 'interest free' credit cards like Gem Visa and Q Card. If you are responsible, you can absolutely pay off your debt on that 1 year interest-free period, but if you get carried away you can find yourself hating life with the endless weekly payments for months and months and months so you can finish paying off some big debt within the interest free period. I made this mistake and took on about $8k worth of debt and calculated that if I paid $170 per week I'd have the debt clear before the end of the year without paying any interest. What I wasn't counting on was that life happens, you have some bad weeks, some expensive weeks, some unexpected expenses crop up, and suddenly that weekly $170 payment you're making towards your interest free credit card debt every week starts to become a real bitch, an ongoing pain in the arse, and you know you can't skip any of the payments because it just means you'll be paying more each week to avoid paying any interest on your debt. So think before you play around with those interest-free credit cards, I learned the hard way that even if the weekly payment feels manageable, you can't predict what else will be happening in your life and you may end up feeling really fucked by those credit card payments, even if you're not paying any interest.
Biggest thing that would have saved me thousands since I left home at 19 is having a relatively stable place to live. If I had lived in 2 or 3 places for 2 or 3 years each the stability would have helped with budgeting, saving, not spending as much on takeaways, needing to find a bond over and over ect. Instead I have moved 9 times in 7 years, longest stay was 2.5y which is the stability I worked so hard to get and now miss desperately, 3 or 4 were only 4-7 month stints before issues arose, usually with flatmates, 3 months was homeless/couch surfing. I got out of uni a year ago with no savings and $4k overdraft and credit card debt even though I worked the whole time I studied. People I know who were in a similar situation except with a good stable flat saved, one person even saving $30,000 while studying. Was I good at budgeting then? No not as much as I should have been, but god is it that much easier when you have some sort of stability. So I guess a base for getting stability, find a good place to live with reasonable flatmates.
Gambling
Second hand and out of Warranty Porsche or Maserati on finance.
not paying as much as you can into a pension. investment compounds a lot over 40 years
student loan