10 Worst Money Mistakes of My 20s (so far…)

Summary

The speaker candidly shares their top 10 financial mistakes made during their 20s, offering valuable lessons for viewers. From neglecting salary negotiations and underutilizing 401k benefits to abandoning old retirement accounts and cash hoarding, the script serves as a cautionary tale. It emphasizes the importance of investing early, avoiding impulse purchases, and the power of compound interest, advocating for financial automation as a key to consistent wealth growth.

Takeaways

• 📚 Learning from mistakes is crucial, and we can also learn from the mistakes of others, such as the story of the dog left in the dark.
• 🎓 The 20s are a pivotal time for financial independence and making decisions that can significantly impact one's financial future.
• 💼 The importance of negotiating salaries from the start of one's career, as it sets the tone for future earnings and promotions.
• 🚫 The mistake of not understanding or utilizing a 401k early on, missing out on employer matches and the benefits of pre-tax contributions.
• 💡 The risk of 'abandoning' old 401k accounts when changing jobs, which can leave significant amounts of money unattended.
• 💰 The downside of stockpiling cash without investing it, especially considering the impact of inflation on cash reserves.
• 🏦 The realization of the power of compound interest and the importance of starting to invest early, regardless of the amount.
• 🛍️ The pitfalls of impulse shopping and treating shopping as a form of entertainment, which can lead to unnecessary spending.
• 🧐 The need to avoid obsessing over small expenses, especially during vacations, and instead focus on creating memorable experiences.
• 📈 The poor decision of making uneducated investments, such as stock picking and investing in crypto without a diversified portfolio.
• 🔒 The lack of diversification in investments, particularly holding too much company stock, which can be risky if the company performs poorly.
• 🤖 The benefits of automating finances, including consistent savings and investments, and the avoidance of late fees and interest.
• 🔄 The ongoing journey of financial health, which involves continuous learning and adapting to make better financial decisions.

Q & A

What is the main message of the video about financial mistakes?

The main message of the video is to share the speaker's personal financial mistakes made in their 20s and to provide lessons learned from those experiences, emphasizing the importance of learning from both personal and others' mistakes.

Why is the 401k mentioned as a significant financial tool in the video?

The 401k is highlighted as a significant financial tool because it is a retirement account sponsored by employers, allowing contributions pre-tax, which can lower tax payments for the year, and often includes employer matching contributions, essentially free money for employees.

What is the problem with abandoning old 401k accounts?

Abandoning old 401k accounts is problematic because it results in lost opportunities for investment growth and compound interest. It's like leaving money behind, which can add up to a significant amount over time.

How does the video address the issue of cash stockpiling?

The video addresses the issue of cash stockpiling by explaining that holding large amounts of cash in checking or savings accounts can lead to a loss of value due to inflation, and instead, investing that money can help hedge against inflation and grow wealth over time.

What is the importance of compound interest in the context of the video?

Compound interest is important in the video as it illustrates the power of investing early and consistently. The earlier and more regularly one invests, the more time there is for the investment to grow and compound, leading to significant wealth accumulation over time.

Why does the speaker mention 'memory dividends' in relation to spending money on experiences?

The speaker mentions 'memory dividends' to convey the idea that spending money on experiences can provide long-term enjoyment and fulfillment, creating memories that continue to bring joy and contribute to one's quality of life.

What is the video's stance on impulse shopping and shopping as entertainment?

The video advises against impulse shopping and using shopping as entertainment due to its potential to lead to financial waste and the accumulation of unnecessary items. It encourages a shift towards utility-focused spending and conscious consumption.

What mistake did the speaker make regarding their company's stock?

The speaker's mistake was not diversifying their investments and holding too much of their company's stock, which increased their financial risk since both their income and a significant portion of their investments were tied to a single company's performance.

How does the video discuss the importance of financial automation?

The video discusses the importance of financial automation by explaining how it can help avoid late fees, ensure consistent savings and investments, and build long-term financial systems that require less hands-on management, allowing for a more passive yet effective approach to money management.

What is the video's perspective on the common financial mistakes made by people in their 20s?

The video's perspective is that while financial mistakes are common in one's 20s, they are also a pivotal learning opportunity. It encourages viewers to learn from these mistakes and to apply those lessons to improve their financial decisions in the future.

What advice does the video give on salary negotiations?

The video advises viewers to always negotiate their salaries, especially when an offer is below expectations or the market rate. It emphasizes that not negotiating can set a lower baseline for future raises and promotions, costing thousands in lost income over time.

Outlines

00:00

📚 Learning from Mistakes: Financial Lessons in Your 20s

The speaker introduces the concept that mistakes, including financial ones, are valuable lessons. They share a personal anecdote involving a friend's dog to illustrate the point and transition into discussing their own financial mistakes made during their 20s. The 20s are highlighted as a pivotal time for financial independence and learning, with the speaker emphasizing the importance of learning from these experiences, regardless of age.

05:00

💼 The Importance of Salary Negotiation and 401k Awareness

The speaker admits to not negotiating salaries early in their career, which led to financial losses over time. They also confess to being unaware of the benefits of 401k retirement accounts for several years. The speaker stresses the importance of salary negotiation and taking advantage of employer-sponsored retirement plans, including the potential for employer matching contributions, to secure a better financial future.

10:01

💡 The Power of Compound Interest and Avoiding 401k Abandonment

The speaker discusses the importance of investing, particularly in 401k accounts, to leverage compound interest for long-term wealth building. They share their regret of not investing early and the realization of missed opportunities due to inaction. The speaker also warns against the common mistake of abandoning old 401k accounts when changing jobs, highlighting the significant amount of money left behind by many people.

15:03

🛑 The Pitfalls of Cash Hoarding and the Need for Investment

The speaker describes their past mistake of stockpiling cash instead of investing it, which led to a loss of value due to inflation. They emphasize the need to invest beyond just saving, especially after establishing an emergency fund, to protect and grow wealth over time. The speaker also plans to share more about their personal investment journey in an upcoming video.

20:03

🎒 Balancing Financial Prudence with the Value of Experiences

The speaker reflects on their tendency to overly scrutinize small expenses, especially during vacations, and the importance of finding a balance. They introduce the concept of 'memory dividends' from the book 'Die with Zero,' which refers to the lasting value of experiences and the compounding joy they bring over time. The speaker encourages using money to create memorable experiences, not just as a tool for financial freedom.

🛍️ Overcoming Impulse Shopping and the Shift to Mindful Consumption

The speaker shares their personal struggle with impulse shopping and using shopping as a form of entertainment, particularly during stressful periods in their early 20s. They discuss the impact of watching 'Marie Kondo's Show' and 'The True Cost' documentary, which led to a significant mindset shift towards conscious consumption and thrift shopping, ultimately saving them a considerable amount of money.

📉 The Risks of Inexperienced Stock Picking and Crypto Investments

The speaker recounts their early investing missteps, including attempting to pick stocks and invest in crypto without a solid strategy, leading to financial losses. They emphasize the importance of building a diversified portfolio with low-cost index funds, as recommended by financial experts like Warren Buffett, instead of trying to predict market trends or engage in risky investments.

🏢 The Lack of Diversification with Company Stock

The speaker discusses the risks associated with holding too much company stock, as their income and investments are tied to the performance of a single company. They explain how not selling and diversifying the company stock they received as RSUs has potentially limited their financial growth and exposed them to higher risk, advocating for a more diversified investment approach.

🤖 Embracing Automation for Better Financial Management

The speaker identifies not automating their finances as one of their financial mistakes, explaining how automation can streamline financial management by ensuring consistent savings, investments, and bill payments. They reference 'Atomic Habits' by James Clear to highlight the importance of systems over goals for making consistent progress, and express their ongoing efforts to implement more financial automation.

Keywords

💡Mistakes

Mistakes in the context of this video refer to financial errors made by the speaker during their 20s. They serve as lessons learned and cautionary tales for viewers. The video emphasizes learning from these financial 'mistakes' to improve one's financial literacy and decision-making, as exemplified by the speaker's own experiences.

💡Negotiating Salaries

Negotiating salaries is the act of discussing and potentially altering the terms of a job offer, particularly the compensation. In the video, the speaker regrets not negotiating their salaries in the past, which is presented as a missed opportunity to set a higher earning baseline for their career. It's a lesson in advocacy and understanding one's worth in a professional setting.

💡401k

A 401k is a retirement savings plan sponsored by employers in the United States. The video discusses the importance of understanding and utilizing 401k plans, including employer matching contributions, as a means to secure financial stability in retirement. The speaker's lack of engagement with their 401k in their early career serves as a key example of a financial oversight.

💡Compound Interest

Compound interest is the interest earned on both the initial amount of money invested and any interest that has been added. The video highlights the power of compound interest in growing wealth over time, especially when investing early. The speaker's delayed investment illustrates the missed potential for compound growth.

💡Emergency Fund

An emergency fund is a cash reserve set aside to cover unexpected expenses or financial hardships. The video mentions the importance of having an emergency fund as part of responsible financial management, suggesting 3 to 6 months of expenses as a guideline.

💡Inflation

Inflation refers to the rate at which the general level of prices for goods and services is rising, and subsequently, the purchasing power of currency is falling. The speaker warns that holding cash long-term can erode its value due to inflation, emphasizing the need to invest to protect and grow wealth against this economic phenomenon.

💡Investing

Investing, in the context of the video, involves allocating resources, such as money, with the expectation of generating an income or profit. The speaker discusses their initial reluctance and lack of knowledge about investing, which led to missed opportunities for wealth accumulation. The video encourages viewers to educate themselves on investing to make informed financial decisions.

💡Diversification

Diversification in investing means spreading investments across various financial instruments to reduce risk. The video points out the speaker's mistake of not diversifying their investments, particularly by holding too much company stock, which can lead to significant financial risk if the company performs poorly.

💡Impulse Shopping

Impulse shopping is the act of making purchases on a whim, often for non-essential items. The speaker admits to using shopping as entertainment and buying items impulsively, which can lead to financial strain and a lack of savings. The video serves as a reminder to practice conscious consumption and prioritize needs over wants.

💡Automating Finances

Automating finances refers to setting up automatic processes for managing money, such as bill payments, savings contributions, and investments. The video underscores the benefits of automation for maintaining consistency in financial habits, reducing the cognitive load of managing money, and ensuring that savings and investments are made regularly without oversight.

💡Memory Dividends

Memory dividends, a concept from the book 'Die with Zero,' refers to the lasting enjoyment and fulfillment derived from experiences, even after the experience itself has ended. The video uses this term to illustrate the value of spending money on experiences that create lasting memories, rather than solely focusing on accumulating wealth.

Highlights

The importance of learning from mistakes, including those of others, to improve financial literacy.

Personal anecdote about a friend's dog as a metaphor for learning from mistakes.

The pivotal nature of one's 20s for financial decisions and independence.

The impact of not negotiating salaries early in one's career and the long-term financial consequences.

The lack of awareness about 401k retirement accounts and the benefits of employer matching.

The common mistake of abandoning old 401k accounts when changing jobs.

The pitfalls of stockpiling cash without investing and the effects of inflation on cash reserves.

The power of compound interest and its role in wealth building over time.

The struggle with worrying about small expenses, especially during vacations, and finding a balance.

The concept of 'memory dividends' and the value of experiences over material possessions.

The confession of impulse shopping and treating shopping as entertainment in the early 20s.

The shift towards conscious consumption and the influence of documentaries on personal finance.

The initial attraction to stock picking and the eventual realization of the benefits of low-cost index funds.

The risks of not diversifying investments and the教训s learned from concentrating on company stock.

The advantages of automating finances for consistency and the avoidance of late fees.

The journey of financial health as an ongoing process rather than a destination.

A call to action for viewers to share their thoughts and experiences with the discussed money mistakes.

Transcripts

you've probably heard some version of

the quote there are no mistakes or

failures only lessons the greatest

teacher failure

is and cheesy as it might be it is true

we really do learn from our mistakes but

we can also learn from other people's

mistakes like one of my friends

accidentally left her dog home alone

without the lights on so she didn't turn

any lights on when she got back it was

dark and the dog because he was pissed

off he pooped in her bed and to make

matters worse she only discovered that

he had pooped in her bed when she went

to bed and she laid in it but hey I

learned something because now I know if

I'm ever going to leave my dog and it's

going to get dark make sure that a light

is on or I'm going to get a poopy

mattress because personally I'm not a

fan of sleeping and poop I know that's a

crazy take I just I'm just so quirky for

thinking that but okay poopy mattresses

aside I'm hoping to extend my metaphor

to share with you guys my version of The

Angry Dog mistakes in hopes that you

guys can learn from them more

specifically I want to share with you

guys my top 10 worst Financial mistakes

in my 20s so far saying so far because

as of this month in July I have now

turned 28 years old so still in the 20s

but you know creeping up there and your

20s are such a pivotal time in your life

for so many reasons there's usually a

lot of change whether it's graduating

college first job first move first big

relationships but the biggest thing I've

noticed in my 20s is just that feeling

of oh shoot it's on me now I'm lucky

enough that I do have parents I can call

when I don't know how to get a car

inspection or whatever other adult task

needs doing but there's still a weight

of independence that I've never had

before financially this is huge for

people your 20s might be the first time

you have actual control over your own

money unfortunately or fortunately it's

also the time in adulthood that can have

the biggest positive impact on your

financial future if you do it right I

say unfortunately because it does kind

of suck that the time in your life where

you probably know the least is also the

time where it's going to make the most

impact to do the right steps but say

lovey by the way even if your 20s are

behind you I still think that these tips

are really useful to hear I've seen a

lot of folks on financial forums say

they're sad because I'm starting too

late but that is a load of crap most of

the time for one these people usually

aren't even old and even if you are

older say you're 75 years old these

money mistakes are still incredibly

relevant if we want to throw another

cheesy quote in the mix how about this

one the best time to plant a tree was 20

years ago the second best time is now so

let's start now cheers to better money

moves for all of us and with that here

are my top 10 money mistakes that I have

made in my 20s if you like videos on

money and media by the way be sure to

subscribe I really like making this kind

of stuff and hopefully you guys like

watching it okay so I'm trying to

organize these money mistakes in The

Logical order of when I first

experienced them and the first one that

I would say I experienced or money St M

I made was not negotiating my salaries

now my first job out of college was at

Disney World making $10 an hour I was

part of the Disney college program if

anyone watching was also part of it let

me know your horror stories below and

there was Zero room for negotiating pay

I'll be honest it was a very informative

time for me as a new grad to learn about

how restrictive service jobs can be I

know that sounds wildly out of touch but

in many ways I was and in many ways I

still am but in this job I was paid $10

an hour with no benefits I went weeks

without a day off sometimes and if I

ever wanted to call out sick I needed a

note from the doctors except if I want

to go to the doctor's office and I was

scheduled to work I'd have to call out

no winning there anyways after that job

I eventually started my career in my

current industry and I was hired at a

startup of about 50 people I did not

negotiate any salary for that one in

part because I just didn't know how to

do that but also because I was so

desperate for a job and then the same

thing happened at my current company

when I got hired yes I got a pay bump

but I didn't negotiate at all because

the recruiter told me we don't do

negotiations here and I believed it

which was dumb I eventually found out

through talking to other co-workers that

they had negotiated their salaries at

the company meaning we do allow for

negotiations I just fell for the line

that they didn't the problem with this

is that negotiations help set the tone

for how you'll be paid in your job and

more broadly your career me not even

asking about say a 10 $10,000 higher

base salary means that I miss out on

$10,000 extra dollar a year and every

time I get a promotion or a raise I'm

starting at a lower level I think that

if an offer comes in below what you're

expecting or what you know is

appropriate for the market it's worth a

conversation to see if the company can

meet your amount I'm curious what folks

think in the comments Below on whether

you should always negotiate a salary

even if the offer is great or if there

are times where you should just accept

whatever offer you first get personally

I kick myself for not even trying to

negotiate because if anything building

up those skills of negotiation are just

really important for my career so that

is the first big money mistake of my 20s

but the next one is rough and that is

that I did not touch my 401k or even

know about it for years embarrassingly I

didn't even know what a 401k was for

years I had this vague notion that okay

it's for retirement I think old people

talk about it and call me old because

you know

I'm talking about it now for those who

don't know a 401k is a type of

retirement account that is sponsored by

your employer meaning that if you are

employed in a traditional 9-to-5 job

your employer likely allows you to

contribute a portion of your paycheck to

a 401k account and sometimes your

employer will even match some of your

contributions that right there is

amazing if you have it offered to you

through your company because it's

essentially free money so I highly

highly recommend taking advantage of it

if you can and 401ks have other great

benefits like the fact that they let you

contribute pre-tax money which can help

you pay lower taxes that year and they

give you high contribution limits but me

I did not take advantage of that amazing

account for years that first startup job

I had had a small contribution

percentage set up that was running in

the background but I barely knew about

it until I left the company and even

then it was a very small amount by the

time I left the total was around $33,000

I know that's not awful certainly better

than nothing but if I'd known more about

the importance of investing for

retirement when you're younger I would

have contributed a whole lot more the

problem is that I wasn't thinking about

retirement and honestly it's easy when

you're young whether you're in your 20s

30s 40s 50s to think oh retirement is so

far away I don't need to be thinking

about that yet but that mindset sets our

future self up for failure I'm not

saying that I throw everything into

retirement these days but I certainly do

it a lot more consistently and

significant contributions because I Want

My Future Self to be able to enjoy

retirement when the time comes I'll talk

more about the compound interest element

of that later but it's also just about

acknowledging that a 401k exists in the

first place something I was not doing

and another part is making sure that I

don't lose track and accidentally

abandon my old 401ks which you guessed

it is money mistake number three this is

something that is not just a me thing

unfortunately it is very much an us

thing if you have ever worked for more

than one company in your career there is

a very good chance you are currently

making the same money mistake of

accidentally abandoning your old 401K

for example at my first startup job I

had my 41k account I barely knew about

that had $3,000 when I left then at my

current job I was given a new 41k

account with my company and started

investing in it regularly but what I

didn't do is bring over that old for 1K

money it was like moving homes but for

getting a briefcase full of cash in the

old safe now that money doesn't

disappear but if you forget about it

which I almost did and many others do

all the time you're throwing out

perfectly good money that you earned as

the New York Times writes in their

article your old 401K out of sight out

of mind and out of money quote as of

June 2023 job Changers had left behind

nearly 30 million 401ks or similar

retirement accounts worth an estimated

$1.65

trillion according to capitalize a

technology company that offers an online

platform to help transfer 41k accounts

as CNBC writes in their headline quote

one in five Americans have inactive

401ks worth thousands of dollars I don't

think I need to spell out why this is

such a disaster of a money move and yet

it is a mistake that is so easy to make

for someone like me who barely even knew

what a 401k was let alone was tracking

all my old accounts I had no idea that I

was supposed to be rolling over these

old 401ks to make sure they were all in

one place luckily there are really easy

ways to do this including the company

that the New York Times article

mentioned capitalize which also happens

to be today's sponsor capitalize offers

the easiest way to roll over your old

401ks and it is completely free they

help manage the entire process from

finding your old 401K to picking a new

Ira to dealing with your 41k provider

for you and if you're like wait a second

why don't I have to pay these guys first

off love that you're asking that always

ask questions like that and two

capitalize is able to keep their

rollover service free because they're

paid when you open an IRA with one of

their preferred Partners if you think or

know that you have an old 401k account

floating out there and you need to roll

them over capitalize is honestly such a

fantastic service to use rolling an old

401k into an IRA provides really great

visibility into your Investments and

fees but it can be very tedious it can

mean calling old employers faxing

documents trying to collect checks and

hope that they don't get lost in the

mail but capitalize does this all for

you so that you can save time ensure

that everything is done properly and you

can have peace of mind that your

retirement money is found and growing I

cannot stress how important it is to not

become part of that group of 401k

abandoners so if you want to avoid my

previous money mistake go to High

capitalized. Cara to roll over your 401k

for free today and a huge thank you to

capitalize for sponsoring today's video

all right so my next money mistake is a

point of embarrassment for me especially

as I've learned more about personal

finance but I'm guessing that a lot of

other people watching this video are in

the same boat and are doing the same

exact thing and that is that I

stockpiled cash for so long and never

invested it the problem here is that

cash is not always King at least when it

comes to long-term wealth building yes I

want to have an emergency fund of 3 to 6

months of expenses yes if I'm saving up

for a big upcoming expense like a down

payment or a sabatical I'll probably

want to have that in a high yield

savings account but everything after

that I should not have been Hoarding in

a checking account because at

inflation's historical average of 3.3% a

year money that's sitting as cash is

losing value every year in other words a

dollar today is worth more than a dollar

in a year so what I should have been

doing is investing that money because

that is how I could hedge against

inflation now I already told you guys

that was bad at investing in my 41k for

years but it was not just my 401k I was

just bad at investing in general as in I

didn't do it I knew I should on this

High concept level but I didn't really

know what it meant to invest actually my

next video will be all about investing

I'm going to talk about what I mean when

I say to invest and then how and where I

personally invest and I want to do that

because I remember being so confused by

the whole thing to the point where I

just avoided any part of investing in

the first place place I instead just let

my cash Reserve stack higher and higher

in my bank account I was like a chipmunk

stashing away all my

acorns it sounds crazy but I managed to

save

$100,000 before I finally finally

started looking into how to invest and

then started investing and once I did I

was pretty bummed to not have started

sooner because just like with the 401K

situation I realized that I'd missed

years of amazing compound interest and

it's that underestimating of compound

interest that lands me my next major

money mistake you see the younger you

can invest the more years you have to

take advantage of that sweet sweet

market growth money guy has an awesome

article on the idea of a wealth

multiplier that shows you how powerful

your age can be when it comes to how

hard your money Works in their chart you

can see how at 20 years old you only

have to invest $95 a month to become a

millionaire by 65 but by 30 it jumps to

$340 a month month by 50 you're looking

at needing to invest over $3,000 a month

to be a millionaire by 65 I joke a lot

on this channel that I love the compound

interest calculator but Jokes Aside The

Love is Real simply playing around with

the calculator and understanding how my

investments today will snowball into

millions later in my life has been such

a motivator for me like I said earlier

in this video it doesn't mean scraping

by and living off just ramen so that I

can increase my savings rate but instead

it's a reframing of what that money is

going to instead of some nebulous

concept of compound interest or

retirement I can think in real numbers

what my money is becoming and how that

equals buying back my time and freedom

that being said admittedly it's been a

struggle for me to get comfortable not

going fool squirrel mode and tucking

away every dollar I earn and that brings

me to my sixth money mistake which is

worrying way too much about tiny

expenses especially while I'm on

vacation now there's a balance to strike

here no doubt I don't want to be someone

who doesn't think at all about where her

money is going and I want to spend

intentionally but I've definitely had

times in my 20s where the pendulum has

swung way too hard the other direction

and I've been a Scrooge McDuck to myself

obsessing over whether I should spend an

extra $20 on this or that and feeling

stressed out if I spend money on

something fun that I wasn't originally

planning for I've noticed this happens

especially when I'm on vacation and I

think it's because I already know that

the trip is costing me more than my

daily expenses because I'm staying in

hotels I'm eating out more Etc whether

this is a surprise to anyone or not I

have been and still often am

uncomfortable with spending money but

what I've learned in my 20s is that

money is and should be used as a tool

yes it can be a tool for Financial

Freedom one day but it can also be a

tool right now to help me create

fantastic memories for myself there's a

concept in the book die with zero called

memory dividends which is the enjoyment

and fulfillment you get from an

experience even after the experience

itself as author Bill Perkins explains

quote buying an experience doesn't just

buy you the experience itself it also

buys you the sum of all the dividends

that experience will bring you for the

rest of your life Perkins also frames it

within the concept of compounding

interest saying quote due to compounding

your financial savings don't just add up

they begin to snowball and the same

thing can happen with your memory

dividends they also can and will

compound this happens whenever you share

the memory of the experience with other

people this is something that I've been

working to internalize myself and I

think I have gotten better about it over

the years cuz I don't want to feel a

Scrooge McDuck and tantrum inside of me

if I decide that getting fancy dilato

while I'm in Italy sounds like a great

idea I want to feel Joy that I'm using

my money for an experience not overboard

to the point where I'm straining my

budget but also not holding my purse

strings with a death grip though I say

that there are definitely times where I

probably should have held on to the

purse strings a little bit tighter and

that brings me to my seventh money

mistake which is impulse shopping and

shopping as entertainment maybe this

comes as a surprise to folks who have

seen my other videos and that I'm always

preaching about conscious consumption

but hey I had to start somewhere and so

much of what I talk about in my videos

when it comes to our relationships with

money and spending comes from my own

personal experience feelings I've had

before and sometimes still do and while

I still certainly shop and sometimes buy

something impulsively I was a whole lot

worse in my early 20s especially right

after college and during the pandemic

right after college when I was working

at Disney and feeling stressed a lot me

and my roommate would go to Target or TJ

Max for fun that was our form of

entertainment and you know what I loved

it I loved impulsively buying random

stuff that I did not need or truly want

things that looked cool and felt cheap

so I'd buy them and clothing wise I

definitely prioritized quantity over

quality back then my closet was massive

but then I remember watching Marie

condo's Show on Netflix along with the

fast fashion documentary the true cost

and something clicked in my brain it was

such a 180 for me because I went from

going shopping for clothes every week or

two to shopping for clothes every 4 to 6

months and when I shop now it's almost

always thrifted and you know what that

one change saved me so much money over

the years plus it reduced my carbon

footprint honestly the mindset shift

that I had from watching those shows was

so significant and it's a big part of

what inspires me to make the videos that

I make now because I like to think that

maybe there's someone out there like me

who reframes their relationship with

impulse shopping or shopping as

entertainment so that it becomes one of

utility instead which in turn can save

you money for experiences in your

financial future speaking of financial

future let's return to the topic of

investing for my eighth money mistake

which is all of the dumb dumb

Investments I made at the start of my

investing Journey if you've watched my

videos before you know that I love me a

lowcost Index Fund these are Diversified

stock portfolios with low costs and it's

what Warren Buffett is always

recommending for investors but lowcost

index funds were not always my go-to I

fell into the Trap that so many

investors especially firsttime investors

get sucked into and that was thinking

that I needed to be some Wall Street

Guru or stock picker AKA picking

specific companies to buy stock from

trying to play the game of buying and

selling on a regular basis to get

returns and even getting into crypto

because I read it was a good idea on

Reddit and Twitter I know I was an

absolute stereotype and just like the

Wall Street bet stereotype I was mostly

losing money on these Investments but I

get why I was doing this and why so many

others do it when we think of investing

we have some woof of Wall Street image

in our mind we think of people yelling

over each other picking stocks or some

Mastermind who analyzes the market and

sees Trends before anyone else and then

we think oh that's what I'm supposed to

do uh no no no no even people who spend

every hour in their career studying this

stuff don't get it right so unless we're

Martha steing it up in here with some

insider trading why would we do any

better I'll talk more about investing in

my upcoming video but you should know

that stock picking in crypto does not

make a good divers ified portfolio it's

risky it's volatile the stats are not in

our favor when we do it this way which

is why nowadays I aim for 5% or less of

my portfolio to be dedicated to these

risky or fun Investments everything else

lowcost index funds baby and guess what

they have so outperformed my stock

picking days big mistake but lesson

learned now my ninth money mistake is

ajacent to stock picking and it is that

I am not Diversified enough with my

company's stock but what's that mean so

for my 9 to-5 I'm paid with a base

salary a bonus but I'm also given

Company stock every single quarter so

every 3 months I'm given more stock and

I've worked here for a little over three

and a half years so I've accumulated a

good amount of stock but I have never

sold a single share and now if I worked

for a company like apple or Nvidia that

has done really well over the years this

wouldn't be a big issue it still

wouldn't be Diversified and that would

be risky but my company has performed

really poorly in the years I won't name

what company but it has just made it so

that I have all my eggs in one basket if

I had instead sold that company stock

when I first received it as an RSU and

put it into something like the S&P 500 I

would have been a whole lot richer and

the issue with this isn't just the fact

that my stock portfolio becomes a lot

less Diversified if I have a lot of one

stock but it's also because my income is

coming from that same company so say the

company goes out of business tomorrow

not only do I lose my income with my 9

to5 but all of my stock is now worthless

that's also why it's important to have

multiple income streams Beyond just your

9 to5 and I'm not saying everyone has to

have a side hustle like a YouTube

channel but even just having Investments

where you're getting dividends and

growth every year that can be another

way that you're Building Wealth Beyond

your 9 to5 and last but not least my

10th money mistake of my 20s so far drum

roll please is not being besties with

automating my finances sooner not going

to lie that statement right there made

me sound like some old Corporation

trying to sound cool and hip guys in the

chat for automated finances for real for

no CAP auto savings and Investments have

serious give toil okay backing out of

the brain rot for a second automating

your finances covers a really wide set

of things from automatic bill payments

to reoccurring Investments to automated

savings and some of these I got a handle

on earlier than others like setting up

my credit cards autop payment was the

very first thing I did after getting a

credit card but in my 20s I have not

been as good about setting up automated

Investments and savings and that can be

bad because it means that I'm not

putting aside money very consistently

the reason automating your finances can

be so great and not doing it can be such

a money mistake is that automation can

help you be more hands-off with your

finances auto payments can help you

avoid late fees and predatory interest

and automated savings and Investments

keep you consistent in growing your

wealth over time in the book Atomic

habits author James Clear writes quote

goals are good for setting a Direction

but systems are best for making progress

automating is essentially building your

systems it's what helps you manage your

money longterm so you don't have to

constantly think about it instead money

can become more of a tool than a

constant question and you can get back

to focusing on other parts of your life

this is something that I'm still working

on implementing in my life and I'm sure

it's something that I'll revisit over

the years because Financial Health isn't

just a destination that you hit and then

you're done it's a journey just like

taking care of your physical and mental

health while these are the worst money

mistakes of my 20s I am sure I am not

done making money mistakes but hopefully

I'm also not done making money lessons

and money wins hopefully I've got a lot

more money wins to come but I'm curious

what you guys think do any of these

money mistakes resonate with you are

there any that you've made that I didn't

mention let me know what your thoughts

are in the comments below and what

topics you would like to see me cover

next like I mentioned earlier my next

video coming up is all about how and

where I'm investing so if you want to

check that out make sure to stay tuned

And subscribe thank you so much to my

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guys all just for watching and getting

this far I appreciate you all so so much

and I will see you next time bye