Rachel Cruze and George Kamel: 9 Money Tips We Wish We Knew in Our 20s

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Your 20s are an exciting time in your life. You’re probably starting out in your career, exploring your independence and trying new things. 

It’s important to remember that the decisions you make during these years will affect the direction your life takes for decades to come. If long-term financial security is a goal of yours — and why wouldn’t it be? — you should lay the groundwork in your 20s.

In a recent YouTube video, personal finance influencers Rachel Cruze and George Kamel discussed the money tips they wish they had known in their 20s. Try implementing these strategies to get a head start on establishing financial security. 

Don’t Stress So Much

The first thing Cruze mentions wishing she had done differently in her 20s is chilling out about money. “I think I was a little wound up. Nobody’s as wound up as me.”

It’s easy to stress about not achieving enough financially. If you feel that way in your 20s or at any other time, you’re not alone. Up to 80% of Americans stress about money.

Kamel describes the financial pressure in your 20s as a feeling of, “I got to get the degree, then I got to get the job, then I got to get the car, then I got to get the house,” and so on. People may feel stressed and disappointed if they don’t achieve those milestones quickly.

Dealing with constant financial stress takes a toll on your physical and mental health, so do what you can to identify and address your financial stress’s source. Maybe you’re trying to project an image of success that’s not sustainable. Maybe your current career doesn’t fit with your long-term financial goals. Whatever the source, you should work toward making changes to alleviate some of your stress, even if you can’t eliminate it.

Start Seeing a Therapist Sooner

Cruze also discusses therapy’s positive impact on her life and how she wishes she had started seeing a therapist in her 20s. While she doesn’t specifically reference financial therapy, it is an option for people who want professional help improving their money thoughts, behaviors and feelings.

Financial therapists work with clients to unpack their financial habits and understand what drives them. If anxiety or stress about money is getting in the way of reaching your financial goals, you may benefit from seeing a financial therapist in your 20s. Dismantling bad financial habits and establishing good ones will pay dividends as you get older. 

Limit Overspending

When you are in the first few years of your career and start making some money, you may be tempted to overbuy. You’ve got a paycheck rolling in, so why not buy the things you want?

As Kamel explains, there’s often a long-term price to pay for that youthful overspending. “It was just like, ‘Well, let me enjoy it, I’m young,’ so I didn’t save a dime. I had to spend two years undoing all of the mistakes that I accumulated.”

When you buy things you don’t need in your 20s, that’s money you can’t put toward your financial future. And if you take out loans to finance those purchases, your future self will need to pay that money back with interest. 

Think carefully about any significant purchases you make in your 20s. Try waiting at least 24 hours before buying something to decide whether you really want it. After those 24 hours pass, you may decide the item is just a passing fancy and save that money instead. 

Avoid Credit Card Debt

Credit card companies make appealing introductory offers to college students and other young people. If you don’t know better, you can get drawn in by these offers and start accumulating credit card debt that threatens your financial future. 

Kamel says he had that exact experience in college. “I got to open two credit cards to build my credit score and racked up some debt there because they get you with the 5% cash back at restaurants and travel. You’re like, ‘Well, those are the fun things in life. Yes, I’ll spend on that.'”

If you use credit cards, try to pay your balance in full every month. That way, you won’t have a credit card debt balance charging high interest rates that average around 22.8% annually. Barring emergencies, only put charges on your credit card that you can afford to pay for entirely.

Don’t Compare Yourself to Others

It’s normal to compare your life to others, but those comparisons will not help you reach your financial goals. Feeling like other people are judging you and your progress is just a distraction — one that’s often not even true. 

Kamel says, “Nobody cares as much as you think they do. They’re too busy focusing on themselves to be thinking about you.”

Don’t compare your career, purchases or financial milestones to other people. Focus on yourself and your goals and try to block out the noise of what other people are doing. With social media, avoiding comparison is more difficult than ever, but it will pay off. You’ll feel more secure and satisfied with your financial progress that way. 

Fill Up Your Gas Tank

The average cost of a gallon of regular gas nationwide is $3.38. Depending on the size of your vehicle and its gas tank, filling up from empty could cost you $50 or more. Some people try to avoid those high charges by adding a little gas to the tank instead of filling it up. 

According to Kamel, “One of the things we do in our 20s is we always just fill up enough to get to the next day because it’s too expensive to fill up all at once.”

You’re not actually saving money with this strategy, though. Each time you have to return to the gas station for another top-up, you’re using extra gas to get there and spending more time at the pump. Instead, save enough to fill up your gas tank in one trip before you fall below a quarter tank. 

Focus On the Things You Can Control

There are many factors in your financial life that you can’t control. The average person doesn’t control the unemployment rate, inflation, interest rates or many other factors that impact their day-to-day lives. 

However, you still have a lot of power to shape your financial future. Kamel recounts when he realized this, saying, “What I could actually control was the guy in the mirror — the way I handled my money, how much money I put away from my paycheck, how intense I was about attacking my debt.”

Don’t obsess over the factors you can’t control. Instead, focus on what you can do to achieve the financial life you want. Think about your goals and the steps that would get you closer to reaching them. For example, if you want to buy a house, you can commit to saving as much as possible for a down payment. 

Learn How To Budget

People don’t typically consider budgeting entertaining, but Cruze argues that “budgeting can be fun.”

“I realized that a budget really gives you freedom. What I found is when I pre-decide how much I’m going to spend, I have zero guilt when I spend that money,” Cruze said.

Even if you don’t learn to love budgeting like Cruze, it’s still an essential skill for financial security. In one survey, more than half of the respondents said budgeting and tracking expenses was the most valuable financial lesson they ever learned.

A budget helps you understand how you spend your money so you can be more intentional about your financial decisions. For example, if saving for retirement is your goal, you can add a section to your budget allocating funds to retirement investments. 

These days, you don’t need to break out physical spreadsheets and calculators to create a budget. Budgeting apps like Every Dollar, which Kamel and Cruze recommend, simplify the process so you can start budgeting right away. Creating a budget isn’t enough, though — you also need to hold yourself accountable to stick to it.

Sacrifice Now for Financial Success Later

Taking control of your finances usually requires some sacrifice. The process may not be fun, so people put it off. Kamel mentions the mindset of “I’ll invest later, I’ll save later, I’ll get out of debt later” and argues it’s damaging.

Eventually, later catches up with you. If you haven’t put in the work to reach your financial goals, you’ll still be in the same place you started. Kamel argues that you should “make the sacrifice now” to make progress toward those goals.

At first, it may seem like it will take forever to get where you want to be financially, but you need to start to have any chance of getting there. Looking back, you’ll be grateful you took that first step when you did. 

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