Money Lessons

Initially, I thought that our twenties are meant for having fun and enjoying life. Now that I’m in my late twenties, there are things I wish I knew about money and life in general. In this article, I will share 8 money lessons I wish I knew in my early and mid-twenties.

Scientific evidence proves that humans learn from birth till they’re twenty years. During this time, their brain is absorbent allowing them to amass knowledge and skills easily. That explains why we spend most of our time during these years in school. However, I didn’t learn much about what happens in their twenties probably because most of us are idle or struggling to realize ourselves. Most of us in this age bracket are fresh from campus and tarmacking in search of employment. However, some have things figured out and already have jobs. Whether or not you have a job these are some money lessons you need to know.

Network and Net Worth

Your network is your net worth. This quote is often overlooked but it carries so much weight. The quality of people you surround yourself with determines the type of person you turn out to be. Most people in their twenties often don’t realize this.

I spent most of my time enjoying life conforming to what my peers refer to as a soft life. I met some important people in society but I never connected with these people as I should have. Most of these people had average wealth and power at the time. We would hang out for drinks and general boy’s talk but that was pretty much it.

Several years later and these people have grown into societal levels I can only dream of. I regret that I did not make strong connections with these people. If presented with the opportunity to connect with important people in your society, make long-term connections. We live in a world where qualifications don’t cut it anymore. One must know important people in the right places to land a job. Simply, we live in a world that’s run by referrals from reputable individuals.

Knowledge amounts to wealth

As earlier mentioned, the majority of the population in their twenties comprise campus graduates seeking employment. They have plenty of time but most don’t know what to do with that time. Like most people, I wasted most of this time playing FIFA, watching movies, and touring the country. Don’t get me wrong, all of these are important things when done in moderation. Now that I’m old enough, I would have done things differently.

I would have spent most of my time acquiring knowledge and skills. Off late I have been debating over Jack’s analogy. “what is better, being a jack of all a trade or being a master of one?” In most cases, I side with being a jack of all trades. The current world needs a flexible person physically, emotionally, and psychologically.

Choose whatever works for you and amass as much knowledge as humanly possible. Whether you choose to be a jack of all trades or a master of one, do it whole-heartedly and learn as much as you can about the trade. You earn more if you are competent enough to climb your career ladder.

Financial knowledge

One of the most important money lessons is knowledge in various aspects of finance. In the section above, I just highlighted knowledge in general. You need financial knowledge whether or not you are financially empowered. If you have lots of money you need this knowledge to manage these large sums of money in your account. If you don’t have enough money, you need financial knowledge to plan for the little you have.

Financial knowledge in this case includes knowledge on investment, stock market, sales, taxes, and different businesses among others. For instance, financial knowledge helps you understand the most suitable investment opportunities in your region and how to leverage them using whatever amount of money you have. Being aware of the nature of the stock market is also a critical aspect of financial empowerment especially in the current world where a large percentage of people earn in foreign currencies.

Financial knowledge also helps us learn about various business ventures that can be profitable. For instance, acquiring knowledge about the dynamics of online business is very important since it empowers us with the knowledge and skills to set up such businesses as side hustles. Knowledge about sales will not only help you run your business but also allow you to leverage your market potential.

Finally, and most importantly is knowledge about taxes. The government can be one’s ally or one’s foe. The government can be your ally if you understand tax policies and how to go about them. There are various ways of getting leniency in the amount of tax one pays. For instance, the rich continue being rich since they invest in real estate since it has lenient taxation policies. On the other hand, the government can be one’s foe if they engage in any form of tax evasion whether knowingly or unknowingly. Most governments have harsh tax recovery policies and I would recommend you learn as much as possible about the different tax policies in your country.

Acquire Assets

Now that you have a network around you and accumulated a large knowledge base, you probably have money in your pocket. The most common thing among most financially empowered people in their twenties is adopting an extravagant life. They become self-proclaimed ambassadors of soft life often touring and partying from one city to the next. Don’t get me wrong, playing once in a while is appropriate, provided it’s done in moderation.

But any knowledgeable person knows that the secret to being wealthy and successful is acquiring assets. The term asset is often wrongly interpreted. In my opinion, the most appropriate definition is one by Robert Kiyosaki (my favorite author). He defines an asset as any entity that puts money in your pocket.

In your twenties focus on acquiring assets. Wealthy people focus on acquiring assets while the poor continue accumulating liabilities (spending more money). Research on the most appropriate assets within your grasp. In Kenya, I’d recommend bills, bonds, money market funds just to mention a few. Focus on acquiring appreciating assets.

How Much Money do you Retain?

As mentioned earlier in this post, most people in their twenties embrace extravagant lifestyles. As a result, they spend most of their money. I recently came across the quote, “you are one medical bill away from going broke”. Sadly, this is the reality for most of us. It was my reality a few years ago before I learned one among many important money lessons;

It doesn’t matter how much money you make. What matters is how much money you retain. Click To Tweet

The most important principle in this life is consistency. One person may earn a quarter a million a month but retain 10% of his/her salary. On the other hand, another person earns half his salary but retains 40% of their salary consistently. Who do you think will be ahead of the other?

After learning the importance of retaining as much as possible from my income, I can promise you that my life hasn’t been the same. It has allowed me to make some major moves most of which I wouldn’t have fathomed a few years ago.

Is your Money Working for you?

You can never become wealthy while you work for money. I don’t believe in impossibilities but I make exceptions in some instances. This is one such instance. Working for money (active income) makes you a zek (prisoner) and few people can escape this fate.

Wealth is realized when one learns to put their money to work to generate what is called passive income. A person with passive income is en route to a wealthy life. Money starts working for you when you learn how to smartly invest in appreciating assets. Buy government bills or bonds and earn passive income in form of dividends.

Do your homework in the stock market and purchase shares. Venture into real estate if it’s a viable venture in your country. There are various ways of making your money work for you.

In my twenties, I missed various key investment opportunities. I wish I knew how to make my money work for me. On the bright side, these were my learning experiences. That’s why I decided to share them with my readers in this article.

Plan for Failure

I collect several phrases each time and my latest one is, “the most important part of a plan is planning for failure”. This quote or phrase comes in handy when dealing with money. Probably you’re wondering, “who plans for failure?” I do and you should too. This is not just about money lessons but about life in general since it helps one lower their expectations.

When it comes to money, it is important to acknowledge that it’s mainly and always about risks.  Every investment opportunity is a risk. The greater the risk, the greater the reward. However, some risks never payout, and one is likely to lose everything. Winning relies on one not being afraid of losing. It is also important to invest an amount that one would not mind losing.

Generally, wealth is about taking calculated risks with one’s money. People who play the investment game safe rarely make huge fortunes. If I had this knowledge a few years ago, my financial situation would be very different right now.

Dream and Work Hard

We all dream. I believe that the main difference between us is the size of our dreams and how much effort we are willing to put to attain our dreams. I came to this conclusion after hanging out with my friends and listening to them narrate their dreams. Most have the means to achieve their dreams but procrastination prevents them from achieving what they dream which reminds of a popular quote in high school;

Dreaming big is not enough, you must be willing to get up and chase your dreams. Click To Tweet

We dream of a life of financial freedom but very few are willing to sacrifice some fun to acquire knowledge and put in the hard work. Some probably have the will but lack the means. Either way, always keep pushing without giving up. If you are willing to sacrifice a few years of fun, things always align and I can promise you will enjoy a lifetime of freedom.


These are the most important money lessons you need to know in your twenties. As earlier mentioned, your twenties are very potent and one should focus on empowering themselves financially. However, these money lessons are universal and also apply to people in other age brackets as well.

I hope you learned something from this article. If you did, please share it with a friend and create awareness. Until next time, Adios.

2 thoughts on “8 Money Lessons you Need to Know in your 20s.”
  1. Very nice post and right to the point. I am not sure if this is truly the best place to ask but do you guys have any thoughts on where to get some professional writers? Thanks 🙂

  2. […] All in all, poverty is the enemy here. Thus any means to eradicate it is a step towards financial freedom. I advise you to face your fears and ask for financial aid without a second thought. In case you get the money, think of other options such as short-term investments or doing something worthwhile. This will help you improve your life. Not only will you help yourself but you can help others and be a good example to them. Check out our other article on the 8 Money Lessons you Need to Know in your 20s. […]

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