3 Important Money Lessons I Learned in My 20s

by Maurie Backman | Updated July 25, 2021 - First published on March 30, 2021

Many or all of the products here are from our partners that pay us a commission. It’s how we make money. But our editorial integrity ensures our experts’ opinions aren’t influenced by compensation. Terms may apply to offers listed on this page.
young woman holding a piggy bank

Image source: Getty Images

My 20s taught me a lot about money management. Here are some of my biggest takeaways.

A lot of us look back on our 20s and shudder. I enjoyed my 20s. During the early part of that decade, I lived on my own in a big city and enjoyed the perks that came with it. Later in my 20s, I got married and spent a lot of time traveling with my husband before children came into the mix.

I learned a number of important things in my 20s, and that extends to money-related matters. Here are a few big financial lessons I came away with.

1. Always have emergency savings

I lost a full-time job during my 20s through no fault of my own -- the company was starved for business and there just wasn't enough work to keep me busy and justify paying my salary. I was crushed and stressed, but thankfully, I had emergency savings to fall back on. Since then, I've made it a point to boost my emergency fund so I always have plenty of cash on hand for a rainy day. My limited savings at the time helped me get through that shaky period, and now, I have a larger cushion to fall back on should my income get slashed without warning.

2. Avoid unhealthy debt at all costs

I spent a good part of my 20s consoling friends who were hassled by debt collectors wanting them to make good on overdue bills. I guess you could say that irresponsible friends were a blessing -- it taught me early on that carrying a credit card balance is bad news. I'm proud to say I've never charged an expense on a credit card I couldn't pay off in full when my bill came due, and that's helped me avoid expensive interest charges I have no desire to get stuck with.

3. Have the right insurance

One day during my 20s, I was doing something innocent enough -- snacking on hard candy -- when I broke off part of my tooth by biting down the wrong way. I didn't have dental insurance because my employer didn't provide it and I didn't want to pay for it on my own. I ignored the problem. My tooth didn't hurt, and I knew going to the dentist would be expensive.

A few weeks later, I woke up to terrible pain. The broken tooth was infected, and I needed a (very expensive) root canal. I expressly remember crying -- not over the procedure, but the bill. I learned then that the right insurance goes a long way.

Years later, when I lost a job, I was tempted to go without health insurance due to the expense. Then I remembered that tooth incident. I forked over the money for COBRA and stayed on my old plan until I got married, when I jumped on my husband's plan. During those five months paying for COBRA, I wound up in the emergency room. Had I not purchased that insurance, I would've been stuck with thousands of dollars in bills. Instead, I made a $100 copay and moved on.

My 20s were certainly an interesting period, and sometimes, I miss being younger and more carefree. But I'm happy to say that I came away from my 20s with some important financial knowledge under my belt that has helped me avoid money-related stress ever since.

Alert: highest cash back card we've seen now has 0% intro APR until 2023

If you're using the wrong credit or debit card, it could be costing you serious money. Our expert loves this top pick, which features a 0% intro APR until 2023, an insane cash back rate of up to 5%, and all somehow for no annual fee. 

In fact, this card is so good that our expert even uses it personally. Click here to read our full review for free and apply in just 2 minutes. 

Read our free review

About the Author