18 Things about Money I Wish I Knew at 18

Navy Federal Credit Union

Published April 14, 2015

Older millennials—those born in the early ’80s—have learned many money lessons in their relatively short financial lives. The dot-com bubble burst while they were in high school, 9/11 turned the economy upside-down as they entered college, and the housing bubble and subsequent recession welcomed them to the workforce. Perhaps because of these events, these young adults have valuable insights to offer their younger cohorts:

Don’t take on too much student loan debt. Consider this. Your post-graduation salary just might not support your student loan payments at first. High payments could actually hold you back from pursuing other goals—changing careers, buying a house or even having kids. Borrow as little as possible and prioritize paying it back.
Save now. No matter how little you make, save some of it for the future. In the future, you’ll have bigger goals—a house, a new car, starting a business. Plan for them now.
Pay yourself first. Instead of saving whatever’s left over, set aside savings before doing anything else with your money.
Buy only what you can afford. Start a budget, stick to it, and establish fun money, emergency, and long-term savings accounts.
Live below your means. It’s really easy to spend more as you make more. But if you do, you’ll risk never getting ahead.
Think of money as a tool. Getting the most out of any tool means knowing how to use it properly and responsibly.
Build your credit. Even if you have the cash (and you should!), use credit cards to establish yourself as creditworthy. Do this by paying off your credit cards each month, so that when you start a business or need a loan to make a large purchase, lenders will want to give you the money you need at a fair rate.
Give yourself flexibility. When you have a financial cushion, you won’t have to worry as much when unexpected bills arise. And if you’re miserable in a job you hate, having money saved means you may have the freedom to accept a lower-paying job you love without falling behind on bills or losing your home.
Take advantage of free money. If your employer matches contributions to your retirement plan, invest at least enough to get the full match. Otherwise, you’re leaving free money on the table.
Understand compounding interest. Your money earns interest, then your interest earns interest. Over time, compounding helps your money grow faster.
Have a financial plan. Seek a professional’s guidance if you need it. You don’t need to be a millionaire to have a financial plan.
Learn about investing. Read books, take a class or sign up for a webinar, but make sure you understand the basics of the stock market and investing.
Don’t put off investing. Invest regularly, even in small increments.
Never invest in something you don’t understand. Whether it’s a startup venture or a sophisticated financial instrument, learn the risks first.
Dream big. Financial stability isn’t just being able to pay all your bills every month. It means having financial goals and a plan to reach them.
Don’t be overly conservative. Without some risk, you may miss out on the gains you need to grow your nest egg.
Invest in yourself. Build up your skills, education and networks to create your success and maximize your earning power.
Spend your time wisely. Treat yourself. It’s okay to spend your bonus on something special for yourself; just make sure you don’t go overboard. Or, consider the treat to be an extra deposit into your savings or investment account.

This article is intended to provide general information and shouldn’t be considered legal, tax or financial advice. It’s always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.

References