6 Things I Wish I Learned About Money When I Was Younger

In Parenting by Kelby6 Comments

I’ve spent the last few years making up for the financial mistakes that I made during the first twenty-something years of my life. Like many, I bought into the idea that money (and things) could make me happy but I faced a harsh reality when this wasn’t the case. Even though I realize that I can’t go back in time and have a do-over (how cool would that be though), I can at least imagine, right?

Well without wasting any more time on the build-up, I give to you – The 6 Things that I wish I learned about money when I was younger.

The Emotional Connection to Money

Forgive me for being Captain Obvious here, but we call it Personal Finance because it really is all about US.  Just think about all of the things that we consider ‘Personal’. For some, it could be age or weight while for others, it may be relationship status or religion.

The underlying point with all of this is: the things that we consider ‘Personal’ are very closely intertwined to our emotional well-being – maybe more than we actually think.

“The thing I have discovered about working with personal finance is that it is not rocket science. Personal finance is about 80 percent behavior. It is only about 20 percent head knowledge.” – Dave Ramsey

Growing up, I never really tied emotion to money. I always knew that money satisfied basic necessities and provided for some frivolous wants; but the realization that fear, anger and guilt could be part of the equation, never occurred to me.

It wasn’t until I had some life lessons where I experienced the fear that comes from loss of income and the guilt of improperly managing money that I was able to understand how my money habits were dictated more by the underlying emotional urges than anything else.

The Consequences of Credit Card Debt

I remember it like it was yesterday – my first day on campus in college. After finishing Freshman Orientation we were taken on a campus tour led by our student ambassadors. We passed the library, saw the football stadium and finally headed toward the University Center where many of us would begin the downward trajectory toward financial disaster.

You see, inside of that University Center were people that were giving us things for FREE! Well, sort of free…I mean, all we had to do was sign their credit card application. But after that, we got a FREE T-SHIRT!!! And not just one t-shirt, we were able to get a free one for each application we filled out. Talk about WINNING! I probably left with a weeks’ worth of shirts on that first day.

To this day, those were the most expensive shirts I have ever worn!

Unfortunately, I made the mistake that many young adults make starting out and underestimated the negative effects of credit cards. In my situation, I was only looking to get free t-shirts and had confidence that no logical bank would approve an 18 year old with no job for a credit card – let alone three.

Those three cards led to a few thousand dollars of debt and years of digging out of a self-imposed financial hole.

The Benefits of Being Frugal

Let me just start off by saying that living a life of frugality often gets a bad rap. Besides the people that actually live a frugal lifestyle and are familiar with the benefits, most people think that when you decide to be more cautious with your spending, you are in some way depriving yourself of living a full and enjoyable life.

Websites like Frugal Rules, Club Thrifty and the Frugalennial (in case you’re wondering – yes…that was a shameless plug) are working to debunk this myth and prove that you don’t have to spend your way into debt to have a fulfilling life.

Since making the decision to be more prudent about my finances, I have found that there is more freedom in that than anything I was doing before. In addition to the monetary benefits of being frugal, I have found that I’m less stressed, have more genuine relationships and am overall happier than I was spending haphazardly.

Compound Interest

When you’re young, let’s face it – you’re dumb. (I’m sure half of you are nodding in agreement while the other half has already hit the ‘X’ on their browser) For those of you on the fence, wait…let me rephrase. When I was young, I was dumb. You? I’m sure you were a genius and have the ribbons to prove it. See…that was better, right?

For those of us that did make dumb decisions in our youth, it’s easy to look back on a big purchase that you quickly fell out of love with or maybe a debt that you wish you would not have incurred and think, “Man, I wasted my money on THAT??” What’s harder to recognize and what few people even give thought to; is the money that you’re losing not because of an action that you’ve taken, but rather, inaction.

I’m sure that I heard the phrase ‘Compound Interest’ when I was younger but it wasn’t even on my radar until I had squandered many years of precious potential earnings. At its simplest, Compound Interest occurs when the interest that you earn on an amount of money begins to grow interest itself.



I’ll give an example that drove the point home for me (from Dave Ramsey):

Ben and Arthur were friends who grew up together. At age 19, Ben decided to invest $2,000 every year for eight years. He picked investment funds that averaged a 12% interest rate. Then, at age 26, Ben stopped putting money into his investments. So he put a total of $16,000 into his investment funds.

Now Arthur didn’t start investing until age 27. Just like Ben, he put $2,000 into his investment funds every year until he turned 65. He got the same 12% interest rate as Ben, but he invested 23 more years than Ben did. So Arthur invested a total of $78,000 over 39 years.

When both Ben and Arthur turned 65, they decided to compare their investment accounts. Who do you think had more? Ben, with his total of $16,000 invested over eight years, or Arthur, who invested $78,000 over 39 years?

For you visual folks out there – take a look at this:

Dave Ramsey

Via Dave Ramsey


Save For Emergencies

The monotony of life can sometimes fool you into believing that everything is running fine on autopilot. That is, until the theoretical bottom falls out. Chances are – we’ve all experienced some type of financial misfortune due to car repairs, medical expenses or loss of income at one point or another. The way that we view these situations is often directly related to how financially prepared we are.

The way that you view a $400 bill to replace your car’s alternator is a lot different when you have an emergency fund than when you live paycheck-to-paycheck with little room to spare. Having been on both sides of the equation, I know this to be true firsthand.


Invest In Yourself

Generally, when we think about investing in ourselves, higher education is the first thing that comes to mind. From my perspective, education is a lifelong process that doesn’t necessarily have to involve a university classroom – or the debt that’s typically associated with it.

Any interest that you could possibly think of is just a Google search away. In addition, resources like Khan Academy and Lynda.com allow inexpensive (and in some cases free) courses in everything from Web Development and Photography to Art and Science.

“You are your most important asset, invest in yourself.” – Les Brown



  • By recognizing that every-single-dollar you spend has an emotional component attached to it will ultimately help guide you toward financial success.
  • Credit cards aren’t inherently bad, but using them without full knowledge of the potential damage they can cause will lead to financial disaster.
  • Don’t listen to the voices that tell you that you must spend in order to live a full life. It’s a lie! You CAN curb your spending and still live a life you love.
  • Start saving early! Give your money the opportunity to grow to its full potential.
  • Put money aside for emergencies because they will surely come.
  • Never stop learning. Invest in yourself – minus the debt.

Is there anything that you wish you would’ve learned at an early age to put you on the right track financially? Let’s talk about it. Join the conversation!


  1. Oh, my goodness! The “visual” on investing early is absolutely shocking! Why didn’t I do that when I was young?! Probably because we were just starting out and we had different priorities. Maybe we thought we couldn’t afford it when in reality we couldn’t afford not to.

    1. Author

      I agree. I think when you’re young, you feel like you have all of the time in the world to save. Unfortunately, by the time you realize that you need to get started, you’ve already lost out on SO much earning potential.

  2. I really like your graph about compound interest. When I started working for the City, investing in the retirement plan was manditory. I chose the smallest percentage possible because at 22 years old, retirement was the last thing on my mind. I didn’t understand it back then but I’m so thankful for it now. I just wish I’d invested more!
    Where I work now, I always encourage new hires to start investing right away, and if it’s at all possible to invest the full amount that the company will match. If that isn’t possible, start with a smaller amount, but start saving for your future!

    1. Author

      You are absolutely right! Even if you start with a minimal amount, it’s better than putting off saving until “tomorrow”.

  3. I wish I would have learned more about student loan debt and how to avoid it when I was in college. I definitely fell for some of those freebies but mine was a free hoodie 🙂 I also had virtually no idea what compound interest was until I started learning about personal finance and I used to think investing and saving for retirement was only for old people, haha. Needless to say, I’m happy I got my act together early so I can avoid some of the common financial mistakes many millennials tend to make.

    1. Author

      Chonce, I’m with you – if I had been educated about the true cost of student loan debt, my life would have been drastically different. I guess the same could be said about compound interest. But, hey…on the bright side at least we figured it out with enough time to still make great financial strides. Unfortunately, there are many people that don’t figure it out until it’s too late.

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