Here's The Best Financial Advice Redditors Have to Offer for People in Their 20s

Figuring out how to manage your personal finances is a process that takes some time. In fact, many young people make money mistakes or decisions that they later end up regretting.

You can avoid having to learn things the hard way if you listen to advice that older, wiser peers have for you -- especially if you're still in your 20s and you are starting with a pretty clean slate.

To help you benefit from the collective wisdom of the internet, check out some of the best financial advice Reddit users have given to people in their 20s.

1. Spend less than you earn

One piece of advice that consistently shows up when Redditors are asked to give advice to people in their 20s has to do with spending. Specifically, as one forum user put it, "Income must be higher than expenses at all times."

Another user provided even more specific advice, warning that "If you can't pay cash -- you can't afford it."

This is great advice because when you're young, and especially when you're just starting out in your career and making good money for the first time, it's tempting to want to pay for things you've been dreaming of, like a nice car or a fancy apartment. And, of course, keeping up with your peers and paying for experiences may seem like something you need to do since, after all, you only live once (YOLO).

While there's nothing wrong with enjoying your money in your 20s, you don't want to get yourself in a whole bunch of ​credit card debt that will only get harder to pay off as you get older and take on more obligations that could include marriage, homeownership, and children.

To set yourself up for long-term financial success -- and to establish good habits that will last a lifetime -- be sure you are spending less than you earn by making a budget and sticking to it. And save up for those things you want to indulge in, because you'll enjoy them a lot more if you actually own them rather than borrowing to pay for them.

2. Invest for retirement now

While retirement may seem like it's in the very distant future, many Redditors urge young people in their 20s to get started saving now because it will be a lot easier to be successful later.

"Open your Roth IRA right now, contribute as much as you can as early as possible. Compounding interest is an amazing thing," one Reddit user said. The forum user went on to explain, "I don't even miss that money because I never had it and I have a home {and} a little chunk of money stashed away."

If you get into the habit of saving for retirement, you won't expand your other expenses to eat up that money and it will just be something you always do. Plus, you'll have more years for your returns to be reinvested and earn further returns, thus helping you build wealth effortlessly.

To understand the importance of starting early, consider what would happen if you wanted to be a millionaire at age 65 and you started investing at 25. If you put aside just $188.28 per month every month and earned a 10% average annual return, you'd hit your goal. If you waited a decade until age 35, you'd have to save $506.60 a month until 65. That's a lot harder.

3. Establish a good credit history

Finally, the last great piece of advice has to do with earning a good credit score, which is important. This sentiment was echoed by many respondents.

"People need to realize that having no credit is just as bad and in some cases worse than bad credit," one user warned. Another suggested getting a credit card, using it wisely, and paying it off in full each month in order to build credit.

This advice is important as well, since so many people and companies -- from landlords to utility providers to cellphone companies -- all check your credit. And it's easy advice to follow. If you get a credit card, set up autopay to pay it off in full, and don't use more than 30% of your available balance, you'll be well on your way to earning a good score. Payment history and credit utilization ratio are two of the most important factors in credit scoring formulas.

By following this financial advice, you can go a long way toward setting yourself up for the future you deserve. If you're in your 20s now, be sure to take the wisdom these Reddit users shared to heart, as it could make all the difference in your financial life.