6 Best Money Moves You Can (And Should) Make In Your 20s

best money moves in your 20s

When you’re in your 20s, it’s easy to waste money and not think about the future. But while foolishly spending money in your twenties may not break your financial future, these years can certainly put you way ahead of the pack if you navigate them properly. Planning early can solidify your place in the wealth squad (or gang!) by the time you get to age 40. With that in mind, we want to present the 6 best money moves you can make in your 20s to help secure your financial future.

To be clear, everything listed below isn’t simply about investing. Sure, investing early can help you become a millionaire by 40, but you want to be well-rounded financially and we think that making money moves like these will help get you there.

6 Best Money Moves To Make In Your 20s

Pay Off Student Loans As Soon As Possible

You can save tens of thousands in interest payments by paying off your student loans early. This is a great way to get out from under that burden quickly and start focusing on your career and financial goals instead.

Start Saving For Retirement

Set up automatic deposits from your paycheck to a company 401K account. If your company offers a 401K match, the minimum you should contribute is enough to get the entire match. Don’t leave free money on the table.

If your company doesn’t have a 401K plan, open a Roth IRA. If you’re under a certain income level ($125,000 if you’re single), you can contribute up to $6,000 per year in a Roth IRA. With a Roth IRA, your after tax money grows tax free until retirement. That means when you hit retirement age, you can start withdrawing money and you won’t have to pay capital gains taxes on it. The only drawback of a Roth IRA is you can’t write off contributions when you file your taxes.

If you happen to make over $125,000 per year and your company doesn’t offer a 401K, consider opening a traditional IRA. This will help you A) save for retirement and B) reduce your yearly taxes.

Open An Investment Account

Start investing in a non-retirement account. If you’re interested in retiring early, don’t focus completely on just a 401K or an IRA. While those are great, they are meant to help you when you hit a typical retirement age. And as little as $100 per month invested in an ETF can set you up for more comfortable financial future. Similarly, if you are looking for other assets to buy in your 20s, you can start investing on real estate crowdfunding sites with at little as $5000 with Realty Mogul.

Don’t Rack Up Credit Card Debt

money moves in your 20s

Bad debt is the reason so many Americans are living paycheck to paycheck. Whether they are overpaying for a new car or they can’t stop spending money online, debt will kill your ability to reach financial freedom.

When you are just starting out in your 20s, it feels great to make more money than you ever have in your life. However, just because you can make payments every month without any problems now, doesn’t mean you’ll be able to if your income takes an unexpected drop?

Focus On Career And Salary Growth

The more you earn in your job the better off you’ll be financially. And, the more you earn, the more you will be able to save and invest for the future.

Create A Budget To Avoid Lifestyle Inflation

As you begin to earn more money, you need to avoid lifestyle inflation. It is OK to indulge a little more, but if you’re making $100,000 and spending $90,000 you’re no better off financially than if you were making $50,000 per year and spending $40,000.

What we’re saying is, live below your means but don’t cut yourself off completely from luxuries: Living within one’s means ensures financial stability while still being able to enjoy small pleasures during your life.

How can you do this? Simple. Follow the 50/30/20 rule and you’re bound to succeed financially.


It doesn’t take a lot of effort to learn how to build wealth in your 20s. When you’re in your twenties, you literally have your whole adult life ahead of you to build your wealth. By making money moves to advance your income and restrict your bad debt, you won’t just be ahead of the game, you will win the game.

C. James

C. James is the managing editor at Wealth Gang. He has a degree in finance and a passion for creating passive income streams and wealth management.