- Jojo Whilden/ HBO
After a decade of experimenting, failing, and learning from those failures, most of us have figured out how to navigate, or avoid, the most common money mistakes by the time we hit 30.
Still, we sometimes let ourselves – and a few money lies – get in the way.
Don’t let these 15 lies hold you back.
Mandi Woodruff contributed to an earlier version of this post.
So long as my job pays well, it’s OK if I hate it
By age 30, no one should be toiling away at a job that leaves them stressed out and dissatisfied with life. Sometimes you just have to say no, and have the confidence to quit.
Need inspiration? Read about this young woman who turned her back on a lucrative job on Wall Street when years of 14-hour work days made her overweight, burnt out, and miserable.
“I’m a few months into my new job [as an asset manager for a nonprofit] and it’s made my life richer. I’m making an effort to breathe, smile, eat healthier and have positive thoughts about my future,” she wrote.
“I took a pay cut of about 30% to change positions, but I don’t think that I should be applauded for making the choice to accept less pay – I don’t view it as a sacrifice.”
- Flickr/Leo Hidalgo
If I turn a blind eye, somehow my finances will figure themselves out
One of the worst things you can do is to ignore financial red flags when they arise.
If you’re broke, you might as well know it and own it. It’s the only way you’ll ever truly be able to do something about it.
- REUTERS/Brendan McDermid
Banks and bill collectors will get their way no matter what I do
At some time, life may get in the way and you’ll find yourself on the wrong side of your bank or, worse, a bill collector.
Stand your ground. Negotiating your way to lower credit rates, car insurance, cable bills, and bank fees is possible, especially if you monitor your accounts dutifully and refuse to take no for an answer.
If you’re ever in doubt, think about Kenny Golde, who managed to negotiate $220,000 worth of debt down to $70,000.
I should buy a home because that’s what grown-ups do
Home ownership is pricey – there’s the down payment, mortgage interest, closing costs, various property taxes, maintenance, renovations, and the inevitable intangibles.
If you’re not quite secure financially, but want to move into a house, consider roommates, Egan suggests, especially if you’re not married yet: “If you’re single, have some roommates to help ease the burden of the mortgage so it doesn’t affect your other savings for retirement or other goals.”
Still unsure if you’re fully prepared financially for the big move? Check out how to figure out if you can buy a home, signs you can’t afford to buy a home, and the salary you have to earn to buy a home in major US cities.
If I start dipping into my savings now, I’ll have plenty of time to make up for it later
If you’ve managed to build a 401(k) with your employer, now is not the time to start chipping away at all that hard-earned retirement cash.
For starters, you’ll be charged a hefty fee for early withdrawal. It’s also tantamount to stealing from yourself in old age.
I can still pull off the outfits I wore in college
There’s a saying career experts love to toss around: Dress for the job you want, not the job you have.
It makes sense. Unless you’ve managed to finagle your way into your dream job by age 30, part of the battle is making others believe you can handle it.
Leave the flip-flops at home, invest in a wardrobe that shows them you’re ready for responsibility – and the heftier salary that comes with it – and you’re already on your way.
- Flickr/Ivan Bandura
I’m a failure because I’m not getting paid as much as other people my age
There’s such thing as healthy competition, but spending every waking moment trying to “beat” your peers is a quick way to wind up alone and miserable. Do yourself a favor and focus on your own path, not stalking your friends’ career moves on Facebook and LinkedIn.
I’m too inexperienced to start investing
You don’t have to be an expert about personal finance or use fancy economic jargon to start investing. You don’t have to come from an affluent family, and you don’t even have to earn a massive paycheck.
The more you can set aside, the better, but even a little bit can go a long way, thanks to compound interest. An easy way to dip your toe into the investing pool is to start saving for retirement using accounts where your money is invested, like a 401(k) or IRA.
I should have kids now because I want them
“There is nothing more destructive to one’s financial future than bringing children into the world without having an established and stable means to support them,” writes finance blogger Len Penzo.
He has a point. It costs well over $200,000 to raise a child in the US – and that’s not even counting college tuition once they leave the house.
And it’s not just your finances that will suffer if you’re not prepared, Penzo notes. It “becomes extremely difficult to start a business, or gain the necessary experience, on-the-job training and/or education required for the type of career advancement opportunities that lead to significantly increased earning power.”
If I get approved for new credit, obviously I can handle it
There may come a time when your credit limit doubles, triples, or even quadruples, especially if you’ve spent a few years dutifully paying down each of your debts.
If your limit increases, you’ve probably earned it, but don’t bite off more than you can chew, and be wary of lifestyle inflation. No matter how big your credit limit, or how fat a mortgage loan your bank offers you for a new home, that doesn’t mean you have to take it.
Know your limits and what you can afford. Then tell them how much you need.
- Kathleen Elkins/Business Insider
I’m pretty much invincible
It’s easy for young people to feel invincible when it comes to health, or to ignore the possibility of a medical emergency. This invincibility complex is costly, as medical bills are one of the main causes of personal bankruptcy. It’s important to plan for the worst, as an unanticipated emergency could turn your life upside down instantaneously.
In fact, health insurance is mandatory in the US, and people who choose not to have it are required to pay a fee of 2.5% of your annual household income or $695 a person, a year – whichever is higher. If your employer doesn’t provide it, you can search for an appropriate policy through Healthcare.gov.
I’ll save a bunch of money by buying the cheapest option
Some things are worth buying secondhand, but not everything.
It’s tempting to try to “save money” by buying inexpensive, low quality things, but oftentimes those cheap products will cost you in the long run.
Learn to invest in things that have value. They don’t have to be big purchases, either; there are several everyday items that can pay for themselves, and you’ll want to be careful of skimping on things like mattresses, computers, and more.
Everything will be work itself out eventually, so I can do whatever I want right now
While optimism is a good quality to have, too much optimism can be dangerous, especially when it comes to money.
People tend to assume they’ll be making significantly more money in their 40s, explains certified financial planner Michael Egan, which they use to justify overspending in the present moment.
“The rule of thumb should be to live below your means,” emphasizes Egan. “Savings first should be your mentality: Save for retirement first, and spend with whatever is left over. What people typically do is the opposite of that, thinking, ‘I’ve got to buy this, this, and this, and whatever’s left, I’ll save.’ Pay your future first, and make sure your present is secure.”
I don’t need goals for my money
If you want to make or save more money, you have to have a clear goal and then a specific plan for how to achieve that goal. Money won’t just appear – you have to work at it. As self-made millionaire T. Harv Eker writes in his book “Secrets of the Millionaire Mind,” “The number one reason most people don’t get what they want is that they don’t know what they want. Rich people are totally clear that they want wealth.”
Write down your goals and financial plan in a notebook. If you’re not a pen-to-paper kind of person, you can always type them up and print them out. Put them somewhere accessible, where you’ll see and be reminded of them each day.
“People who write down their financial goals get rich. It’s a fact,” David Bach writes in “Smart Couples Finish Rich.” “Study after study has shown that writing down your goals makes it much more likely that you’ll achieve them.”
Getting rich is reserved for a select few and out of my reach
“The average person believes being rich is a privilege awarded only to lucky people,” self-made millionaire Steve Siebold writes. “The truth is, in a capitalist country, you have every right to be rich if you’re willing to create massive value for others.”