I turned 40 last year, and I found myself sitting down one evening reminiscing about things I know now and wish I knew earlier in life.
This is not a regret post in any way; it is instead a reflection post and I hope it can be a guide for you if you are in your early 20s and 30s so that you can avoid the same mistakes I made.
If you discover these secrets early in life, your future self will thank you for it.
I wish I knew that:
I Did Not Need a Credit Card to Improve My Credit Score
My ignorant self thought I needed a credit card to improve my credit score. I got a card and did not bother much about the interest rate; I used it, paid for it, and repeated the circle countless times until I began to use the card a lot and paid little. This resulted in the accumulation of debt.
Looking back now, I realize I did not need to do that. I could have built my credit score by paying my utility bills, phone contracts, water bills, electricity, and gas bills consistently. Paying these bills was enough to improve my credit score.
By the time I found out, I did turn it around, but that was money that I could have spent somewhere else, saved or invested. I ended up paying off debt that I didn’t need to acquire because I wanted to build a credit score.
I Did Not Have to Invest In Shares Only
The second thing I wish I knew early in my 30s’ is that I could invest in mutual funds and exchange-traded funds and not just in shares. I grew up believing that to have paper investments, I had to invest in specific shares, which led me to buying shares.
Shares are more expensive to purchase because you have to buy them in units.
For instance, if you want to invest in the shares of a company like Amazon, you need to have about 3000 dollars per unit, and for Tesla, you need 6000 dollars per unit. It discourages you from going into paper investing because you are there thinking; “I will wait till I have 2000 pounds or 3000 dollars before I buy my shares because there is only so much I can buy with less”.
Real Estate Investment Trusts (REITS) Allow Easier Property Investment
If you are in your 30s’ and you are yet to know this one, you are not alone because I learned this in my late 30s’.
REITs make it easier for you to invest in properties especially if you are not keen on owning a second, third, or fourth property. REITs are for you if you are not ready to become a landlord because you are worried about the time requirement and regulations, or having to get up on a Saturday morning to your tenants’ house because they have a boiler problem.
You can put the money you want to put into a second property into a Real Estate Investment Trust. Then sit back while someone else buys and invests in property on your behalf and pay you in returns. Easy-peasy!
A 5% Deposit is Okay
Yes, it is okay to have a 5% deposit when buying property. I fell into the belief that if you do a 5% deposit, you can lose your property to the bank, or the 5% can disappear if the market crashes.
I was a victim of the fear-mongering that came with the 5% deposit and believed that I needed to have at least a 10 or 15% deposit to get property which slowed down my ability to get on the property ladder.
So if you qualify for a 5% deposit as a first-time homebuyer, you can look into getting a 5% deposit and all the government helps you can get. You can also consider opening a lifetime ISA for buying your property and take advantage of all the opportunities and avenues out there to help you get on the property ladder.
I Could Contribute More to My Pension
Although I have never been one to postpone or ignore my pension, I did not realize that I could max out my pension allowance asides from that of my employer.
What I used to do is max out my pension allowance with my employer such that if my employer says I can invest up to £300 in my pension, I would do that and allow my employer to match it.
Now I know that I should have opened a Self-Invested Personal Pension (SIPP) to invest money on an investment platform into a personal pension and manage myself.
That would have allowed me to put more money into my pension instead of doing the bare minimum by maxing out my workplace pension.
I did not realize that I could have an additional contribution to my pension (using my SIPP) and that I had a £40000 pension allowance (which is what you get if you work and earn up to £40000).
My Career Does Not Define Me
As a career-oriented girl, I had always wanted to be in full-time professional work. It took me some time to learn that my career does not define me. If you think your career defines you, you should change that mindset. Your career is not who you are.
I have learned to walk away from telling people that I am a management consultant or an accountant. This is because I am more than that. I am a finance guru, the Bulletproof coach, a wife, a mom, and other things beyond my career.
It took me time to accept that my career does not define me. What makes this important is that sometimes your career slows down. When my career slowed down, it made me sad and disturbed, but once I learned and accepted that it does not define me, I became a happier person and found purpose and joy outside my career.
It Is Okay If You Have Not Found Your Purpose
It is okay if you are in your thirties and have not found what you think you should be doing in life. Some people are early bloomers, while some are late-bloomers. Do not compare your journey with that of others. You can find your purpose anytime. In the meantime, keep doing what you love.
Do What You Love and Get Paid For It
I wish I knew that I could do what I love and make it pay. I am currently doing the things I love by writing on this blog, YouTubing, coaching, and talking about money. These are the things I am passionate about and get paid for.
Not Quitting Before the Big Moment
I am a great kick-starter, a self-starter who does not need anyone to motivate her but halfway through, it gets hard, lonely, frustrating, and financially draining. Then, I start to rationalize why and how I should quit. I would get bored, move away and start something else.
I used to be a fashion designer, but the moment I started struggling with customers, finding a good production warehouse, and combining it with my day job, I simply walked away instead of hanging in there.
Now that I know better, I have learned to persevere in any project I venture into and hang in there till I get a breakthrough.
Appreciate your body and take care of it
Many people are guilty of this. In my early 30s’, I could eat and eat and not gain weight. I could go for weeks and months without exercise. Now, I wish I exercised more in my 30s’ because it has gotten more difficult to run. However, I have now learned to walk away from junk foods and exercise more.
It is important to take care of your body, floss daily, take your vitamins, eat the right foods, drink a lot of water, and mind your business. Appreciate your body and take care of it.
Although this did not apply to me in my 30s’, I would advise that you save and invest aggressively, and join a pension in your early years. Save as if your life depends on it. Compound interest and time is your friend when you invest early and get on a pension.
I hope you have enjoyed this post.
Until next time,
All my love
Ronke O.