The 5 Biggest Mistakes People Make In Their 20’s (And How To Avoid Them!)

What's up you guys? It's Graham here. Now, it sounds really weird to say, but I'm nearly finished up with my 20s. In two years, I'm gonna be 30 years old! That sounds really weird to say; that's trippy. The same almost 30 sounds better than saying 28.

But anyway, these are the top 5 mistakes I notice people making in their 20s and how to avoid making them. Now, some of these mistakes are bigger than others. Some of these are really easily avoidable; some of these are just inevitable mistakes you have to make just as a growing experience in your 20s. But these are the ones that really stood out over all the others that I can think of.

Now, the first one—and it's also probably one of the biggest ones—is living a lifestyle you can't afford or just living above your means. Now, this is also probably one of the most common mistakes I see people make in their 20s. This is also something that's very easy to get carried away with, especially if you’ve just finished up with school. You get your first job, you start making money, you don't really know how to budget. It's so easy to say, "You know what? I'm young! I got my entire life ahead of me to save and invest; I may as well spend some of the money now and enjoy it because I have my entire life ahead of me."

This is when the trips come up, the expensive weekends going out, buying designer clothing, buying things you don't need. Just bought this new Lamborghini here and everything else that comes along with that. Well, meanwhile, you might be barely scraping by or, even worse, going into debt.

And the effects of debt really end up compounding against you. Instead of saving your money and having it grow and having it work for you, the debt actually continues to grow and work against you, making it a harder amount to pay off. This is also one of these things that it's very easy to get used to nicer things very, very quickly. So if you ever need to move back from that and maybe scale back a little bit, it's very difficult to do that.

Because all of a sudden, everything else other than what you're used to just seems inferior. So just knowing this right off the bat: Don't get used to a lifestyle that you know is not sustainable. It's also very easy to get caught up in this if all your friends and all the people around you are spending money. You just feel compelled to spend more money than you're used to or want to spend just so you don't feel left out.

Not only that, but these small daily five to thirty dollar charges add up to a lot over time. You do that every single day for a year, and that's $1,800 to $11,000 a year of spending without ever really even realizing it.

Now, it's even worse than that when you could barely afford something. We're sure you make enough money to buy it, but at the end of the week, you're tapped out, or you just need to wait until your next paycheck. Now, this is a really precarious place to be at because you've gotten used to a certain lifestyle, but if anything happens, you suddenly can't afford it anymore.

This also keeps you reliant on your income, even if this means you're working a job you really don't like or doing something you really don't want to do. You're forced to do it just to keep up with your lifestyle. But what's worse than that—and yes, it gets worse than that, and I'm sure a lot of people can relate to this—is when you work a job you don't totally love, but at the same time, you don't hate it enough to want to quit.

It's somewhere right in the middle where it's comfortable, but you know you're better than that job, and you know you're bound for something much greater. But at the same time, it's a steady paycheck, and it's comfortable, and it pays for the things and the lifestyle that you're accustomed to.

So you spend your time wasting away there because you're comfortable, and it pays the bills. And that, you guys, is absolutely not the spot you want to be in in your 20s. You want to take risks; you want to try new things; you want to be as mobile as possible. You want to be able to move around as much as you can, getting on as much experience as you can.

Being too reliant on a luxury lifestyle and needing that income every single month to pay for it just hinders your ability to go and pursue better and bigger opportunities. And it's a bit of a balancing act because, by no means, should you just stay inside all day because you don't want to spend money. But at the same time, you really should know yourself and know your finances to know if you can't afford something—to feel comfortable with saying no or just really planning your finances and budgeting enough that you know when you can afford something and when something is just out of reach.

Make sure to have three to six months saved up as an emergency fund, just in case something comes up, and just track your expenses. Now, I personally use Mint.com and PersonalCapital.com. This video is not sponsored by them by any means, but it is something that I do religiously. I will track every single penny that comes in and out of my accounts and find out exactly where my money is going.

One of the best ways, if you ever want to cut back without ever feeling like you're cutting back, is to look through the last three months of your bank statements and see where exactly you're spending your money on. I guarantee you're spending your money on things that you don't even realize you're spending money on, and those are the things that are the easiest to cut back that save you the most money without ever even realizing it.

And just the act of tracking your expenses is gonna make you more vigilant on what you spend your money on, and you will just, in coincidence of that, spend less money and save way more. And remember to always live within or below your means. You can always increase your spending later on; a year from now, decide to spend all of your money—go for it! But that's a lot easier to do once you already have a healthy savings and know how to budget properly.

The second mistake I see so many people in their 20s making is not building up their credit history. One of my biggest pet peeves I see is people in their mid to late 20s paying for things with a debit card because they don't have a credit card. And because they don't have any credit history, that is unacceptable. Building up your credit as soon as you can, even if you're in your late teens or early 20s, is going to help you tremendously in the future.

Anytime you want to buy a house, a car, get a business loan, leverage your money, rent an apartment—do just about anything that requires a credit check. This is also one of the biggest financial mistakes that I personally made. I grew up thinking credit cards were evil and that they shouldn't be trusted and that only people that didn't have money to buy something used credit cards, and they were irresponsible. I heard it all, and that's how I was raised.

But I found out, as soon as I wanted to leverage my money and invest in real estate, I got screwed by not having a credit card or having any credit history. I estimate that I probably lost about $500,000 when I was buying real estate by not being able to leverage my money because no lender wanted to give a 22-year-old a loan with zero credit history! That all could have been avoided had I just gotten a credit card as soon as I turned 18 years old.

This is also why it's so important to start building your credit history as soon as you possibly can. This doesn't mean that you have to go out and spend money you wouldn't ordinarily spend or pay interest on a credit card or do anything you wouldn't ordinarily do. Just treat your credit card like an extension of cash in your bank account.

Don't go out there and buy a $3,000 TV when you only have $500 saved up in your bank account because you could afford the really low monthly payments of $40 a month for life. Don't do that. The expectation when it comes to a credit card is that if you can't afford something outright, chances are you can't afford it. But beginning this credit journey and getting good financial habits early on is vital.

And this doesn't mean you have to go over the top either. Once you turn 18, you can go to the bank and get what's called a secured credit card. This is where you put down a deposit of usually $200 to $500, and they give you a credit limit of $200 to $500. Basically, your money is held as collateral against the credit limit that they give you.

And that's all it is—basically just put little expenses on the card every now and then and then pay it off at the end of the month in full. Like I said, this is probably one of the biggest mistakes I made, and it's also one of the easiest, simplest things to avoid. So if you're watching this right now and you're over the age of 18 and you don't yet have a credit card, promise me, if you get anything from this video—this entire video? I'm filming it on a Friday night; it's like 10:30 p.m. for me—just do this for me because you will thank me five, ten years from now.

Just go and get a secured credit card! If you're over the age of 18 without a credit card, just go and do that one thing. That's it! I'm not even asking you to subscribe or like or add me on Instagram and Snapchat because I post there pretty much daily, so if you want to be a part of it there, you can. I'm not even asking for any of that. Just get a credit card, please, with a small limit, paid off on time, in full, every single month. And that's it! You may be happy.

Now, the third mistake I see a lot of people making in their 20s is them just waiting around doing nothing, expecting for something to magically happen and appear for them. The realization here is that nothing will happen if you don't take the initiative to make it happen! And it sucks that this stuff isn't taught in schools. They should be teaching you how to go after what you want because the reality is that in school, they tell you, "Do this at this time, and this is what's expected, and this is exactly what we want from you."

But in life, nothing like that happens. Nobody expects anything from you in life. Nobody is handing anything, and nobody tells you what to do. I see way too many people out there just waiting for the right opportunities to come around, but in reality, they're not doing anything to go after those opportunities, and they are just waiting for them to fall magically from the sky and into their lap.

It's this simple: If you want something to happen, you need to go out and make it happen. You need to take the initiative to decide what you want and how you're going to get there. And this is probably one of the biggest mistakes I see people making, is that they're wasting their time away instead of going after their goals.

And even if they don't know what they want, they use this as an excuse just to do nothing. So even if you don't know what you want to do, it's not an excuse. Go and try new things, look at different opportunities, find out what you like and what you don't like. Find out something you really enjoy doing and then figure out a path from there. And if you already know the path you want to take and what you want to do, find a plan of attack.

Schedule exactly what you need to do to get to where you want to be. There's no excuse to not doing this and not sticking with your plan because only you will find yourself accountable. There is not going to be someone every single day making sure you hit your goals and making sure you hit exactly what you want to do because honestly, nobody gives a sh—nobody cares if you stay at home all day. Nobody cares if you waste your entire week. Nobody cares if you don't do anything with your life because they're too caught up in their own life.

The reality is that you need to be accountable for everything you do, and you need to be self-motivated enough to actually go and do it. You want—you need to be the one to push yourself to do more every single day. You need to be the one that motivates yourself to get up, to hustle, to kill it, and to go after everything that you want because the sad truth is that nobody else will do that but you.

And this realization is probably one of the best things that you can learn in your 20s, especially if you want to be your own boss or be an entrepreneur, is learning how to be self-motivated and stick with your plan. And learn to push yourself because nobody is going to come in one day, discover you, and then all of a sudden, you're gonna strike riches. Learning how to be your own boss is probably going to be one of the most profitable and most rewarding things that you will ever learn how to do.

And I get it; it's so easy to have the mentality of, "I'm in my 20s, I'm young, and I have my entire life ahead of me. What is the rush?" But I'm telling you, I'm 28 right now, and it goes by in the blink of an eye without you even thinking about it. What you think is five years goes by in what feels like five minutes.

If you want something, you need to go out there and make it happen! Look at Lil Tecca as an example. She's nine years old, and she's flexing on all them haters because one morning, she woke up and said, "You know what? I'm gonna be broke no more!" So she got out after working hard, happy, holding her mama's hand right now.

The fourth mistake I see people making in their 20s is being too afraid to take risks and take chances. Your 20s are really the time where you could take as many chances and take as many risks as you can because with every failure comes the experience and the knowledge of what not to do. Sometimes you just need to take the leap of faith to try something new in your 20s, and this is the perfect time to do it.

It's the perfect time before you have that huge mortgage, before you have the wife and the kids and the job and everything else that's holding you back from trying something new and potentially failing. Now is the time to try it and potentially fail, but learn from it, before you have too much to lose. Maybe you should take the riskier career option; maybe you can start your own business or try new experiences or go and travel and start a career somewhere else before you have too much to lose.

And now is the time to do it! Now, of course, don't go stupid with this—don't make any really irrational decisions that just don't make any sense whatsoever—but, generally speaking, you're gonna be able to have a lot higher of a risk tolerance in your 20s than probably any other age because of this. It's okay to move to a different job if you feel like that might be a better fit for you.

It's okay to start the business and bootstrap it and put everything into it if you really believe in it—just go for it! And worst case scenario, even if it fails, you lose it all. Chances are, you really didn't lose much to begin with; you haven't really fallen that far, and now you have the experience of what not to do and what it's like.

It doesn't even need to be a financial risk, by the way. Just even socially, throw yourself into social situations—even if you're uncomfortable—because nothing is going to happen. This sort of stuff is all just a temporary discomfort that could lead to a lifetime of opportunity.

Now, the fifth mistake I see a lot of people make in their 20s is not staying healthy. And I'm talking about the excessive binge drinking, the drugs, the staying out late, the partying, the eating fast food all the time—doing things that just aren't productive or healthy. These things all just end up slowing you down at a time where you can really do your best work.

So just stay healthy, exercise, eat good foods, don't do drugs, don't drink excessively, get a good night of sleep every night, and doing this sort of stuff is going to make you feel sharper. And when you feel sharper, you're gonna be happier, and if you're happier and sharper, you're gonna end up making more money and doing better long-term.

Oh, and also, not to mention the fact that you will probably live longer if you take care of yourself and are healthier! So if even just not for the money aspect, if you want to live a longer life, just be healthier. These are habits that are so easy to start when you're young and keep them consistent that if you put it off, and then all of a sudden you realize ten years from now you've got to get your act together and lose weight and eat healthier and stop smoking and stop drinking and doing all these things because you realize your health is suffering, it's so much easier now to get used to this and keep it up than to put it off and do it later.

Just start it now. Just be healthy now. Just go to the gym now. Just do all of these things that really end up helping you in more than just one area of your life. Because my experience has been when I go to the gym and eat healthy, I'm a happier person, I do better work, everyone else around me enjoys me more, and it's just all-around so much more pleasant.

And this should really be the time to start all of these habits now, then putting it off, figuring you're just gonna do it later, thinking you have plenty of time to do it later. No one is forcing you to do it right now. You're still young—start it now!

So, as always, you guys, thank you so much for watching. I really hope you enjoyed this. If you did, make sure to give it a like. Also, feel free to comment down below. Any sort of engagement on these videos is so helpful! So, like, comment, share, subscribe—all that good stuff!

Also, feel free to add me on Snapchat and Instagram; posts are pretty much daily. So if you want to be a part of it there, feel free to add me there. I also had a cool real estate group in the description. It's a private Facebook group for anybody that wants to join that talks about real estate, real estate investing, real estate agents, and anything real estate. Links are in the description to all of that.

And thank you for watching, you guys! I really hope you found this helpful. I tried to be as comprehensive as I can with something like this. I hope you enjoyed it, and until next time!