Live For Today Or Save For Tomorrow?

I recently stumbled upon an article written a couple months ago over at Elite Daily: If You Have Savings In Your 20s, You’re Doing Something Wrong.

The title is pretty self-explanatory, but here is my Cliffs Notes version:

Lauren, the author, is a 20-something living in NYC with no savings (a conscious decision on her part). She prefers the enjoyment of spending her hard-earned money over the security of saving it for a rainy day. Her argument? The “networking” she does during nights out on the town will likely lead to raises and/or better job opportunities. In the long run, this will benefit her much more than socking away $200 per month. Lauren believes she and her peers have been given financial advice by older generations of people that are simply out of touch with the reality of being a 20-something. Young people today are choosing to delay marriage and having children in order to extend their youths. As such, they shouldn’t have to carry the same financial burdens their parents did at the same age.

Lauren is very convincing in her writing – I’m sure her fiscally irresponsible peers are buying her shots  in appreciation of this article. YOLO, right?

(I’m a millennial and I hate that term. But it seems appropriate here, especially since I get the opportunity to mock it.)

Here’s the thing – I relate to this article so much because I was Lauren. I moved to Las Vegas when I was 18 and lived there for most of my 20s. At the time, I convinced myself I was only moving out there for school. In retrospect, I really just wanted more adventure and excitement in my life, and Las Vegas provided the perfect opportunity for that.

[Side note: I don’t regret this decision one bit!]

From the ages of about 18-24, I did what many young, financially-ignorant people do. I took on tens of thousands of dollars in student loans without thinking about the repercussions (despite having a full scholarship and part-time job). I maxed out my credit cards, bought clothes I didn’t need, spent nights out “networking” with fun people, and just generally lived the high life. I didn’t save money – that wasn’t even on my radar.

In the moment, it was awesome.

But now? My 33-year old self would like to sucker punch my 23-year old self for being so stupid and irresponsible.

Sure, I made memories – good, bad, and ugly – but at what price? I am still paying for many of those bad financial decisions to this day. It took years to dig myself out of credit card debt and build a respectable FICO score. I’ll be paying on my school loans for-freaking-ever. I was lucky to meet my future husband at 24 – I credit him with knocking sense into me and helping me turn my finances around. If not for him, things could have ended up much worse.

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Herein lies the major problem with this article, and why it’s particularly dangerous for 20-somethings to take to heart: the implications of the financial decisions you make in your 20s can stick with you for years, if not decades. That’s not something anyone should take lightly in the name of “living it up.”

But why does it have to be an all-or-nothing proposition?

Why can’t we live for today and save for tomorrow? What if I had only racked up $5,000 in credit card debt rather than $10,000? Or taken out $30,000 in student loans rather than $40,000? Or saved $20 per month rather than nothing? What if I had given one ounce of thought to my future? I’d be in a significantly different place with my finances right now, that’s for sure. And as a young-ish 30-something, I think that’s a very important thing for 20-somethings to understand.

I’m not against having fun, “networking,” and spending frivolously – been there, done that (and will probably continue to a certain degree). I just think we all need to find balance in the process. And if we don’t seek out balance as young people, we are likely to develop (bad) habits that stick for many years.

Lauren is writing her article based on how she feels as a 20-something, and I can’t fault her for that – I just think it’s very naive. And I can’t help but assume she’ll feel the same way looking back on it in 10+ years with the advantage of life experience and perspective.

[Side note: Mr. Money Mustache wrote an article in response to Lauren’s entitled “If You’re Not Getting Rich In Your 20s, You’re Doing It Wrong.” I highly recommend it!]

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How do you balance living for today with saving for tomorrow?

What small step have you taken today to reach one of your goals?

I ran 5 miles…one at an 8:12 pace! (That’s fast for me.)

 

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