27 Things I Learned About Money by 27

I turned 27 last week, or as my young sister likes to say, I’m three years away from 30. A lot has changed since I started Broke Millennial as a 23-year-old woman not even two years into my post-college life in New York City. My relationship with money has evolved. My knowledge has certainly sky rocketed. Peach and I finally live near each other – which brings a whole different set of money conversations to light! I started to read back through old posts and interviews as well as reflect on the direction I’d like to see both my career and financial life go in the next few years before 30. Hey, it’s my next significant milestone age. In this reflection I’ve come up with 27 things I’ve learned about money by the time I turned 27.

  1. How I value my time: Some of the things I used to do to pinch a penny seemed like the storyline of TLC show (hello freezing water bottles to put in my bed during the summer months). Sure, I still do some extreme frugal moves, but one thing that’s drastically changed is how I value my time. This sometimes has to do with convenience, like taking an Uber to the airport instead of the bus, and sometimes has to do with how much I charge for my work.
  1. Out-earning your partner when you’re serious, but not married, causes interesting financial challenges: Peach and I aren’t married, aren’t even living together, but the fact I have a positive net worth (he has student loans) and out-earn him sometimes causes interesting tension. It’s certainly made us talk through our money strategies and goals to an excessive degree – but that’s probably more credited towards my general love of personal finance. We have plans for how to handle money when we’re married, but what happens when you’re really serious but not legally yoked is a rarely spoken about topic.
  1. You’ll gravitate towards people with similar financial values: Maybe not in college and maybe not in your early twenties, but eventually you’ll start to see your circle of friends have eerily similar values to your own. Sometimes it’s seemingly silly differences like whether their club folks or dive bar aficionados and others it’s about whether they’ll accept “hey – want to just split a bottle of wine and chat instead of paying $15 for a single cocktail?” as a serious Friday night option. Or maybe that’s just getting older in general.
  1. Invest in yourself: Accumulating money to just sit pretty in investing or savings isn’t always the best option. Whether it’s picking up a new skill or using a big chunk of your savings to develop a short film that gets into TriBeCa (#shoutout to my sister) – investing in yourself is a risk worth taking. There are times I regret not taking a leap of faith and sticking to the traditional, safe path. Hopefully, I’ll feel confident taking my own advice at 27 (or at least by 30…).
  1. Dogs are expensive (and worth it): 26 was the year I made one of only two impulsive decisions in my lifetime and adopted Mosby. He came into my home as a slightly beat-up (probably 7-year-old) snuggly dog. I panicked immediately Mosby surgery after we got home and wondered how I could possible adjust my life around caring for another creature who solely depended on me. Now, I’m full-blown dog mama status (seriously, check out my Instagram). Mosby is insanely good for my mental and physical health – no backyard means lots of walks – but I do pay a price. He’s cost me $4,204.16 in almost a year thanks to an unexpected surgery, flying him with him on a few vacations, and my general over indulgences in buying him top-of-the-line food and treats.
  1. Opinions are a lot like… There are lots of colorful ways to end that sentence, so you can fill in the blank yourself! Everyone has an opinion with how money should be handled, spent, saved, invested or whether debt can be good or is never to be touched or if credit scores are imperative or Satan’s incarnation in the financial world. You need to develop your own opinion on financial matters. Yes, sometimes there is a right answer – like it’s important to be on the right side of compound interest. But sometimes it’s about finding what’s best for you and not just following the path of the latest financial trend.
  1. Personal finance is PERSONAL: Nothing like regularly sharing your opinions with a wide variety of audiences across multiple platforms to really reinforce how to put the personal in personal finance. I acknowledge that some of what works for me will not work for others, but just starting the conversation gets everyone moving in the right direction!
  1. For the love of God – set up your beneficiaries: It seriously takes minutes of your day to set up beneficiaries on your financial accounts. Your account might make it easy by prompting you to have a beneficiary under the account management tab or you may see the terms Payable on Death (PoD) for bank accounts or a ToD (Transfer on Death) for investments. Yes, your bank account should also have a PoD. This is just a kind way to save your family some serious angst if you meet your maker in an untimely way. I see it as an act of love. Otherwise, your money could end up in probate court! Even just a little money…
  1. It’s time to have a will: Yup, on a roll about death right now. Odd for a healthy 27-year-old woman, but hey, we’re all going to die. I realized earlier this year that it was time I ensure my money and special belongings ends up in the hands of my loved ones with no stress on their end. I also have stipulations in my will about where Mosby is to go and even have a special amount of money earmarked for his care. Plus, getting a basic will put together is simple and pretty cheap. P.S. Your beneficiaries do trump what you put in your will. So you might want to keep that in mind when you get married, have kids, etc.
  1. Everyone loves the term F@*k Off Fund (and should have one): This idea, while not exactly a new phenomenon, went viral in early 2016. While I’ve always be a saver, the concept of money specifically earmarked so I can walk away from a sticky situation is motivating. I don’t personally think of my F-Off fund as a separate account from my emergency savings fund, but the term is just way more fun. I should see if I can rename my savings account…
  1. Name your savings accounts: Speaking of naming savings accounts, do it! It’s my favorite simple trick to save money that isn’t automating. You’ll find yourself more likely to stick to a goal when you’re depositing money into your “EuroTrip” fund or your “Ditch this Job” account instead of “Savings Account”.
  1. Early retirement movement 101: I recently read an interview I did on another site a few years ago about the FI/RE movement as it was just gaining mass popularity. Woof, have my thoughts changed. While I still don’t think I’d feel financially secure with just a million dollars in the bank and a family to raise in my thirties or forties, I’m starting to better understand the financial independence/retire early movement. To me it’s more around lifestyle design ala Tim Ferriss and structuring your life to be able to work as you see fit and not feel the need to exchange your time for money in the traditional 9-to-5 sense. And wouldn’t we all love to be there ASAP?
  1. Sharing your net worth with friends is okay: Unlike other bloggers, I’m not open about my net worth on this site. 11401047_10152863018227411_7914065475825605415_nThere are a variety of reasons for this, but a big one had to do with not wanting people who actually know me (friends, co-workers, extended family) to have that much information about my financial picture. I didn’t want it to get thrown in my face that “yes, you can afford x,y,z” when I used, “eh, I don’t really want to spend money on this right now.” My values and other people’s values don’t always align, so it can frustrate folks when I’m unyielding about dumping money into something they find worthwhile. However, I did open up to a few people about my net worth recently because it felt like the right place and time. I also trusted these loved ones not to use the information as justification for trying to get me to do things in the future.
  1. Over-extending yourself is a budget buster: The biggest mistake I made at 26 was over-extending myself, a lot. This comes with both health and financial repercussions. A week into being 27 and things aren’t exactly going any better. It is a goal of mine this year to figure out when to say no and redirect some focus on self-care.
  1. You can’t fix (money) stupid – don’t be a 20-something idiot: Getting paid per clicks or just wanting to go viral is creating all sorts of obnoxious content. Some of my least favorites are the articles about money that help justify bad financial decisions in the name of YOLO/FOMO/insert any other dumb-dumb millennial acronym here. You don’t need to be blowing money to live a full life. Even in New York City! I know, I live here. Unfortunately, no amount of reasoning is going to fix stupid. It’ll probably take being 45 with no retirement savings and $40,000 in credit card debt to get the wake-up call that something needs to change. At which point, I’ll happily say, “told ya so!”
  1. Re-evaluate your budgeting style: I’m a fan of a budgeting style I affectionately call the “No Budget Budget”. It’s a bitIMG_3104 of a mash up between different well-known budgets with a tribute being paid to zero-sum budgeting without the focus on categories. I pay myself first (savings + retirement). Pay my bills. Then the remaining money can be spent as I see fit. This strategy has proved effective for me in the last few years, but it’s time to switch up my style. In my 27th year of life, I plan to give the zero sum budget it’s due diligence in an effort to double down even further on my savings goals and prepare for some next steps in my life.
  1. “Don’t let other people spend your money” is easier said than done: This probably got born out of the “Keeping up with the Jonses” era idioms – but sometimes other people are seriously going to spend your money. Looking at you attending weddings and the $15,000 price tag I believe is attached. Sure, I could say no – but I do genuinely want to attend many of the weddings to which I’m invited as well as stand up next to dear friends and family as they profess their love to their partners. Therefore, I save for other people’s weddings and know full well they’re really getting to spend my money…
  1. Have a long-term vision: Like most normal people, I hate the question “Where do you see yourself in X years.” Truthfully, I don’t really know. I have a couple hazy day dreams about where I’d like to see my life by 30, 35 or 40 – but I’m not sure what my #1 life goal really is. I save to be able to life without stress over paying my bills and to be able to take some nice trips, but mostly, I save just for the sake of saving. It’s important to start developing a long-term vision so there are actionable steps to start working towards. Not in a vision board sense, but in a lifestyle design and career building sense. It may mean needing to quit certain projects or pivot along the way, but it’s time to really focus in on what will make me feel fulfilled while also paying the bills.

    Lightening Round

  1. You can crack the coveted 800 credit score by just using credit cards as your only means of credit. You don’t have to have loans in order to build a good credit score. #humblebrag obviously.
  1. Lifestyle inflation is very real and very dangerous. Boost your savings as soon as that new paycheck hits the bank account.
  1. A cash diet is like eating clean (or juicing) for your finances and probably worth giving a try to make your bank account IMG_3167feel better.
  1. Never “give a loan” to a person with whom you are close. Give a gift with no strings attached. Awesome if he or she decides to repay you, but be prepared to never see that money again.
  1. Do a net worth check in at least once a month. It’s important for you to see how your investments are performing and if you’re really saving like you thought and (for those with debt) – how much progress you are or aren’t making.
  1. It’s important to talk to your parents about their financial situations, especially as they near retirement.
  1. Don’t offer people advice about their financial habits unless it’s solicited.
  1. Assuming life would be much different if you made X probably isn’t true. When I earned $37,500 a year, I believed NYC would be my playground if I made $80,000. I now earn more than $80,000 a year and I indulge ever so slightly more than when I occupied the $37,500 bracket, but mostly I just save more.
  1. Money can indeed bring you happiness – to a degree – but sometimes it’s important to stop fixating on dollars and cents so much.
Posted in Millennials, Random Tagged with: ,
42 comments on “27 Things I Learned About Money by 27
  1. NZ Muse says:

    I love this post! So much good stuff.

    I will say that while my life on the surface may not look much different now at $80k compared to $40k, under the surface it is SO much better. I’m much happier, less stressed, have a home to call mine that isn’t making me sick, and the future looks a lot brighter.

    • Broke Millennial® says:

      Thank you for bringing up what it looks like underneath the surface! The ability to avoid lifestyle inflation and accumulate stuff usually means things start to look pretty darn good when the salary goes up. Just might not look different to your friends.

  2. Great post!!
    This really hit home for me. I am also in my late twenties (28) getting ever so close to 30. Over the past 2 years my whole outlook on life has changed.
    While it started with getting finances in order, that started a whole chain of events that has led me to reevaluate life and how I live it. Just like you, it has came with trial and error, but there are no rules when it comes to this. We’re all just learning as we go, but I feel like we have a head up on most.
    Again great read!

    • Broke Millennial® says:

      Thanks, Kevin! It’s amazing how much perspective shifts as you get older. One of my favorites I didn’t include in this post is that I used to want a $6,000 minimum engagement ring and now I don’t want one period!

  3. Dogs are so expensive!! I love my dog so much though I don’t mind. I’m a total dog mom now – showing everyone pictures and talking about my dog on the reg – oops! As a fellow 27 year old, I must say this list is spot on. The biggest financial learning point for me has been that priorities change over the years. I want different things at 27 than 23 so maintaining financial flexibility is important.
    Julie @ Millennial Boss recently posted…Til Debt Do Us Part No LongerMy Profile

  4. So much yes to ALL of this, especially as a fellow 27-year-old! And preach on the $37,500 to much-higher-income thing. The only two things I really value that are different about my life now? My dog and in-unit laundry. They can pry my laundry appliances from my cold dead hands.

    • Broke Millennial® says:

      In-unit laundry?! You are living the life. I can’t wait to have laundry in the apartment. At least I only have to walk about 100 steps down to the end of my block, but still…it’s a pain.

  5. Great advice for any age, Erin. I really like that you’re planning to focus on self-care more this year. It’s something I really wish I had started prioritizing earlier. Burning out has certainly shifted my opinion about financial independence. While I’m not striving toward an early retirement, I am looking for more control over how I spend my time. Like you, I don’t necessarily want to be hustling all through my 30s and 40s.
    Kate @ Cashville Skyline recently posted…How a Scarcity Mindset May Be Hurting Your FinancesMy Profile

    • Broke Millennial® says:

      Thanks, Kate! Yes, self care is so important and just fell off the wagon as a priority at 26, which ended up manifesting in some unfortunate ways. And I’m very much with you on striving for controlling time over the traditional notion of early retirement.

  6. What an informative list. I really like your point about “don’t let others spend your money”. I sometimes feel pressured to go on vacations and travel because everyone else is doing it. Gotta remind myself that I have my own set of priorities.
    Aliyyah @RichAndHappyBlog recently posted…An Introduction to Motif Investing (Plus a $100 Sign Up Bonus!)My Profile

    • Broke Millennial® says:

      Travel and my dog are really my top priorities when it comes to opening up that wallet, but I totally get how that just isn’t the same for others. Setting up your own set of values and sticking to them is really important.

  7. I am 25 years old and I am grateful that you shared this money lessons! We have some similarities, but I’ve learned a lot from your experiences. Thanks!

  8. Great post! I’m with you currently with getting a dog! I’ve had him for a year and still sometimes panic about it, but I love him to death and he brings so much joy (and cheap entertainment!)

    • Broke Millennial® says:

      Cheap entertainment is a good point! Never thought if it that way, but it’s so true. Probably drives my friends nuts how much I snap his every move.

  9. Liz says:

    I always assess my budget scheme on a regular basis so that I am always updated on my current budget and I can fit the way how I spend money in my budget.

    • Broke Millennial® says:

      That’s a wise move. I run a budget weekly, but I don’t often change my strategy for the budgeting style.

  10. Great post and happy birthday! I feel like our 20’s are when so many of us learn and grow the most since we are on our own and finally able to develop as a person. It’s definitely interesting to look back and see how things have changed, that’s one reason I love blogging.
    Catherine Alford recently posted…How to Make All Your Dreams for Your Family Come TrueMy Profile

    • Broke Millennial® says:

      Thanks, Cat! It is so awesome to have many of my thoughts chronicled in this way and to be able to reflect how much my opinions have changed and my career.

  11. I think #1 (How I value my time) and #20 (Lifestyle Inflation) correlate with one another, at least a little bit. Sometimes lifestyle inflation isn’t always a bad thing. Priorities and perspective are always evolving:

    Tonya’s post —>http://budgetandthebeach.com/2016/04/25/lifestyle-inflation/

    I’ve been focusing on developing a long term vision as well. You may not know exactly what life will be like, but you do know the type of life you want.

    • Broke Millennial® says:

      That’s very true. It isn’t always a bad thing. I don’t regret switching from taking the bus to the airport at all! 😛

      And well put about not being sure what life will be like, but finding the style of life you want to live.

  12. I wish I was reading this blog in my 20’s!

  13. #26 is what I’m feeling right now. I always think about how much happier I’d be if I only made more money, but it’s just a number in the end. Life probably wouldn’t change too much. Great post!

    • Broke Millennial® says:

      Thank you, Thomas! It honestly probably won’t change all that much, except your net worth will increase. My lifestyle really hasn’t changed significantly and I still stress about money in odd ways because I do feel the need to be making more and hitting certain milestones by specific ages.

  14. *starts freezing water bottles to put in bed during summer*

    I totally understand your reasons behind not sharing your net-worth. It’s not for everyone, and I so agree that some aspects should be private. I admire you for this.
    Alyssa Fischer recently posted…Want to Make Me Cry? Waste A Little More Food.My Profile

    • Broke Millennial® says:

      It’s a great trick I tell ya! I actually just used some ice packs the other night when my pup couldn’t cool down (still no AC) but kept insistent on snuggling with me! I had to shove ice packs in between us so we could both cool off.

      And thank you about the net worth choice! I do feel inclined to start verbally sharing when directly asked, but otherwise, it doesn’t need to be on the internet.

  15. James says:

    What could probably the no. 28 thing you think you’ll add to this list? Thanks for sharing these as it is really an eye-opener!
    James recently posted…The Importance of Having Auto InsuranceMy Profile

    • Broke Millennial® says:

      I guess you’ll have to tune in next year for 28!

      In all seriousness, I’m not sure. Probably about getting a bit more aggressive with investing in index funds. I still think I have too much sitting in cash.

  16. Happy 27th Erin! My favorite advice you gave is “talk to your parents” and love them with all you got!

    • Broke Millennial® says:

      Thanks you, Sam! It’s amazing how few people have spoken to their parents about retirement/end of life care. I’m blessed to have parents very open about these topics.

  17. ZJ Thorne says:

    The no unsolicited advice rule is my favorite for every area of life. No one else has your precise needs and desires.

  18. Loved this. I really struggle with 25, need to work on that.

    • Broke Millennial® says:

      It’s a quick way to burn a bridge (pardon the cliche). I’m always happy to dish out tips, but only when directly asked. Learned the hard way though.

  19. These are great tips! I love them. I agree its scary to post net worth online, I do it but my friends and family dont know I blog and I dont keep pictures of myself on it so it keeps me feeling warm and cozy at night. 🙂
    Alexander @ Cash Flow Diaries recently posted…May 2016 Net Worth UpdateMy Profile

    • Broke Millennial® says:

      I totally get doing it if no one knows because then it doesn’t provide the potential awkward situations.

  20. jim says:

    Boomer here and I am absolutely LOVING all your guys’ millennial finance blogs! Good Lord if we had only been 1/2 as smart as you guys are when we were in our 20’s. I’m actually going to share this with our 20-something. Great content – however, I must admit that I laughed my ass off when the discussion turned to “talk to your parents when they’re approaching retirement re: end of life things” – ha! We’re not dead yet – not even close (we think). But I will tell you this, even being way “dumber” than you guys are in our 20’s, we’re well over the $1M mark now and trust me, there is nothing special about us. When we were in our 20’s all we were concerned about was “how are we going to eat and pay our bills – period”. Little to no thought was given to saving or thinking about retirement. It is fantastic that you guys are so way ahead of the game that way and it will pay off for you like you can’t even imagine right now. Best of luck to all!!!!!

  21. Matt Kohn says:

    Many great things to remember in this post! Indeed we need to be good stewards of our wealth and need to have a good plan how to handle it well.

  22. Exposing your net worth online is definitely dangerous. I got a comment from the girlfriend’s parents the other day that went something like, “hey we see you have enough money to spend on things so why don’t you do …. [xyz]” I see why other family members of mine are so private about personal financial details
    Millennial Moola recently posted…What’s an EFT? (And Other Funny Post-Brexit Questions I’ve Received)My Profile

  23. Trading time for money is definitely not whats up, I was fortunate enough to realize having to work for someone else for 40+ years wasn’t going to work for me. It’s amazing how many people fall a victim to the rat race.

Leave a Reply

Your email address will not be published. Required fields are marked *

*

CommentLuv badge