25 Things I’ve Learned Before Turning 25

Since today is my 25th birthday, I wanted to take a minute to reflect on some of the important life lessons I’ve learned so far. Here’s a list of 25 things I’ve learned before turning 25 to help me live the happiest, healthiest and wealthiest life I can. 

1. Get out of your comfort zone.

While it’s important to be safe and comfortable, it’s also important to have goals and reach for the stars! Most of the time, getting out of your comfort zone will help you grow in ways you never thought you could and help open your eyes to new opportunities. You know what they say… no risk, no reward!

2. Don’t be afraid to ask for help.

Knowing when to take a step back and ask for help is definitely a skill, but it’s a very important one to learn. Whether you’re asking for help personally or professionally, most people are happy to lend a helping hand. Don’t be afraid to ask for that reference or call that connection who specifically gave you their number! People are usually happy to talk about their experiences and/or help you in the process.

3. automate your savings.

If you have a consistent income, setting up an automatic transfer to savings and investments the day after you get paid will help build your wealth substantially. Set it, forget it and watch your net worth grow.

4. Stop buying cheap clothing.

Not only is fast fashion horrific for the environment but the stuff never, ever lasts. Opting for more high quality basics that will go with everything is the way to go. Quality over quantity.

5. Negotiate your income.

This is an absolute must. When you get hired, the hiring manager is almost always expecting you to negotiate and won’t always give you the highest number right off the bat. Check online to see what similar job titles are making in your area and ask for what you’re worth. Even if you already have the job, make sure you’re asking for a raise to get paid what you’re worth. If you don’t ask, they’re not just going to hand it to you on a silver platter.

6. Spend less than you earn.

Spending less than you earn is a key component to building wealth. If you spend less than you earn and invest the difference, you’ll be on your way to financial freedom in no time.

7. Start Investing as soon as you can.

One of the most important aspects of investing is time. It almost doesn’t matter what you invest in (almost…) as long as you have a long time horizon. Time in the market is better than timing the market. Plus, if you’re not investing, you’re losing money to inflation every single year!

8. student loans can be very beneficial.

I know this is a touchy subject and may be even an unpopular opinion, but student loans have been an important aspect in my finances. It’s important to point out that student loans are absolutely a privilege that I am very grateful to have access to. By utilizing student loans, I have been able to substantially grow my wealth by keeping my own money invested in the stock market for the time being. I know exactly what I have used the loan for, exactly how much I owe and I have a plan to start paying it back as soon as I graduate.

9. building a healthy credit score is important.

Your credit score is an important factor for financial institutions to decide how reliable you are with money. Want to save hundreds of thousands on your future mortgage payments? You’ll need a good credit score. Want to save thousands on a future car loan? You’ll need a good credit score for that. Want to rent that amazing waterfront apartment? You guessed it, you’ll most likely need a good credit score for that. Sometimes certain professions even require an acceptable credit score! My favourite way to check my credit score for free is with Borrowell. The easiest way to build a healthy credit score is to use a credit card for every day purchases. With that being said, it’s always important to keep your utilization under 30%, never spend money you don’t already have in the bank and pay your card off in full every single month. You do not need to go into debt to increase your credit score. 

10. Resting is productive.

Sometimes I feel guilty for taking an hour to sit down, rest and watch a show on Netflix. I always feel like I should be doing something and if I’m not then I must just be lazy. It’s important to remember that resting is a must if you want to be more productive. Our bodies need to recharge and rest will help prevent us from burning out.

11. you need to set up email alerts for your credit cards.

If you haven’t already, set up email alerts for every purchase you make on your credit cards. If you get an alert that you’ve just spent x amount at Save-on-Foods and you just got home from the grocery store, great! However, if you’re sitting at home on a Sunday in Vancouver and get an email alert that you’ve spent x amount in Florida, that’s obviously not you! Call your bank ASAP and let them know your card has been compromised. We all want to think that it will never happen to us but fraud does happen!

12. High interest saving accounts are a MUST.

Traditional banks offer interest rates as low as 0.005-0.01% for a savings account while online banks like EQ Bank and Neo Financial are out here offering interest rates as high 2.25-2.50%. Remember that inflation is about 2% per year, meaning that the money you have today will buy you 2% less next year. High interest savings accounts offer you up to 225-250 times the interest plus free unlimited Interact e-transfers, transactions with literally no strings attached. Free money and great service… what’s not to love?

13. Travel as much as you can.

I think the pandemic has made us all realize that we need to get out and about and see the world whenever we get the chance. Travelling helps soothe the soul, helps us learn about different cultures and allows us to experience all that this amazing planet has to offer. You don’t need to break the bank to travel and you definitely don’t need to go into debt to travel. Start a travel fund in your savings account, switch to a credit card that offers travel points and travel local if you need to. You deserve a break.

14. You don’t need a new car.

Your first car does not have to be brand spankin’ new. One of the worst things you can do with your money is to buy a car! Why? Almost all cars are depreciating assets, meaning they go down in value over time. Start saving in your high interest savings account, start investing and buy the three year old model to start.

15. RENTING is not throwing money down the drain.

I’ve grown up in an environment where the idea of buying a home is always better than renting, but I have to say, renting is pretty awesome. You are paying for a place to live and you literally get a roof over your head and a kitchen to cook your meals. Plus, if there are any issues, you won’t be paying for it – that’s your landlords problem! Before you buy, save up that 10-20% downpayment, ensure you have a 3-6 month emergency fund and do a trial run to ensure that you could actually live comfortably with the new mortgage payment. However, owning a home isn’t just the downpayment and the mortgage. If you’ll be needing to buy new furniture, add that to the cost. Plus, don’t forget about the closing costs, lawyer fees and land taxes too! Don’t be pressured into buying a home before you’re ready. Renting is not throwing money down the drain.

16. even if you do everything right, you’ll still make mistakes.

We’re all human and we all make mistakes. Make sure you take accountability for you actions and learn from your experiences so you can do better in the future. Try to see failure as a redirection and a way for you to learn rather than seeing failure as purely a negative outcome. 

17. retirement is a number, not an age.

You don’t need to wait until you’re 65 years old to retire. Multiply your monthly spending by 12 to get your annual spending then multiply that by 25. Whatever that number is, that’s the number you need to hit to be able to withdraw 4% of it every year with a high probability of never running out of money (assuming your money is making an average of 7% annually in the stock market). Retirement is an age, not a number!

18. It’s never too late.

It’s never too late to start saving, to start investing or to go back to school. It’s never too late to start prioritizing your dreams. Stop wishing you had started earlier and just start today.

19. budgeting is the best.

I know budgeting has a really bad reputation, but I truly love budgeting! It wasn’t until I started being mindful with my spending that I was able to invest 50-60% of my income, save up to travel to Hawaii, Paris and Zurich, etc. Budgeting is not restrictive, it simply lets you decide where your money is going to go. It’s important to be realistic, not optimistic and make a budget that truly reflects your values.

20. Sinking funds are life changing.

Ever heard of a sinking fund? Basically, a sinking fund is a savings account for a specific purpose. At the moment you might simply be saving 5% of your paycheque just to say you’ve saved 5% of your paycheque. However, let’s say you want to travel to Maui next year. Let’s start putting that 5% of your paycheque into a sinking fund you’ll call “Travel”. Once next year comes around, you’ll have enough saved up for your trip! It’s called a sinking fund because you’ll build it up, spend it and then build it back up again. I currently use EQ Bank and Neo Financial for my sinking funds. Saving up for specific purposes rather than having one big savings account has been seriously life changing. 

21. monthly money dates are a must. 

Mark a day in your calendar every month to sit down with yourself, review your spending for that month and make a plan for the next month. Look out for the purchases that spark joy and definitely look out for the purchases that spark regret, anger or frustration. Pour yourself some coffee or a glass of wine and make a date out of it, all while ensuring your spending and saving is in alignment with your values. Think about your future goals and ask yourself if your current budget and saving/investing strategy is helping you get there.

22. Debt isn’t all bad.

Debt also has a really bad reputation but not all debt is bad. It’s best to pay off all high interest debt like credit card debt as soon as possible. However, paying the minimum payments on your low interest debt may be more beneficial for you in the long run. As an example, it’s okay to pay the minimum payment on your student loan while you start investing for your future. There’s no shame in paying the minimum payment on your mortgage while you invest for your retirement. Whenever we take on debt, it’s important to have a plan to pay it off, but know that your debt does not define you. You’re making the best decision for you.

23. Everyone needs an emergency fund.

The first step to any financial plan is to build up an emergency fund. Ideally, an emergency fund should be 3-6 months of bare bones living expenses so you would be able to survive and get back up on your feet if you suddenly lost all sources of income tomorrow. Having an emergency fund ready to use as a safety net when life doesn’t go as planned is so important. Mentally, you’ll feel more at ease knowing you’ve got yourself covered in the worst case scenario.

24. be frugal, not cheap.

Being frugal is about spending more on things you love and less on things you couldn’t care less about. In order to be frugal, try focusing on spending money on your hobbies and things you value versus simply always trying the find the cheapest option. 

25. You don’t need to fit into someone elses timeline.

Sometimes it feels like our life is not going as planned because we idealize having a good job at 25, getting married at 27, buying a home at 28, having kids at 30 and living happily ever after! Relax and stop comparing yourself to others. You’re doing absolutely amazing and life is going to work out just the way it’s suppose to because no one else is living your life.

I hope you’ve enjoyed the 25 things I’ve learned before turning 25. Comment your favourite life lessons below!