Things I Wish I Had Known When I Was 21

1. You need to start investing now. I could be almost a millionaire right now if I had started investing right out of college.

2. Just because you can afford the monthly payment doesn’t mean you can afford it. This one is the number 1 reason I’m having to deal with debt at the age of 35. Up until last summer, every big item I bought (house, cars, pool) was based on whether or not I could afford the monthly payment. Stupid, stupid, stupid.

3. Don’t spend every penny you earn.

4. Everything except for your house should be bought with cash. And when you buy your house, only get a 15-year mortgage. If you can’t pay it off in 15 years, you can’t afford it.

5. Don’t buy a home until you have enough cash to put at least 20% down. Paying PMI (mortgage insurance) stinks.

6. You don’t need a credit card for ANY reason.

7. You should never, ever buy a brand new vehicle. They are a horrible waste of money.

8. Borrowing money to buy a car is stupid. If you need to borrow money, you cannot afford the car. I’m working my rear end off to pay for my car now. Each month I’m sending around $1000 to the loan. It’s not fun.

9. Start a budget today. Don’t wait until you are 35 and are used to spending money like it’s water. It’s much harder to start at 35.

10. Don’t buy dumb things. Here’s a short list of dumb things I’ve spent money on:
A collection of Liz Claiborne purses @ $80 each
Eating out every day for lunch – this went on for years
Everything I’ve ever bought on a “no-interest” plan
Not to mention the new cars and the pool…