---
title: '87. Realistic Financial Milestones to Hit in Your 20s! (with ages)'
source: 'https://youtube.com/watch?v=SAxlbzkyQgw'
video_id: 'SAxlbzkyQgw'
date: 2026-06-28
duration_sec: 0
---

# 87. Realistic Financial Milestones to Hit in Your 20s! (with ages)

> Source: [87. Realistic Financial Milestones to Hit in Your 20s! (with ages)](https://youtube.com/watch?v=SAxlbzkyQgw)

## Summary



## Transcript

[Music]
Don't Depend on Daddy is an unfiltered
safe space empowering young
professionals to build independence in
their 20s and beyond. Whether it be
personal, professional, or financial.
Regardless of your age, relationship
status, or job title, the most
consistent person in your life is you.
So, join me and let's build our
independence together. Enjoy.
Hello and welcome back to Don't Depend
on Daddy the podcast. My name is
Michaela. I am your host. And today we
are going to be talking about financial
foundations and personal finance
milestones to reach throughout your 20s.
I'm super excited about it. I think this
is going to be a really great just like
reference point episode to come back to
year overyear. And as we get to the end
of the year, a lot of these episodes are
going to be more like retrospective and
reflective on how to manage your money
at the end of the year going into a
fresh year where we have a little bit of
a fresh start. Before we get into this
episode, I'm going to run through the
housekeeping quickly. First things
first, as always, you can get $10 off
the personal finance dashboard when you
use the code podcast 1. The Black Friday
sale for the PFD has officially ended.
But if you are new here and this is the
first episode you're listening to, you
can always use the code podcast 1 for
$10 off the PFD. The PFD is my, you
know, signature money management
financial planning tool. It's a tool
that I've used to save my first 100K and
now I've grown my net worth to almost a
million using this tool. So, it works
and it just will help you feel more
confident in your overall financial
picture. So, you can get $10 off with
the code podcast 1. I am going to be
running another sale, not a Black Friday
sale obviously, but um as we get to the
end of the year and we're thinking about
2025 planning and everyone is sort of
auditing and thinking about their
financial goals, I'll be running another
sale. So, if you want to wait and get
$15 off instead of 10, feel free. But if
you don't want to wait, use the code
podcast one. The other quick thing for
updates is own your career and own your
money. Um, so if you are someone who is
looking for a gift for either a recent
grad or a young professional or someone
in your life who is looking to overhaul
their finances and take their
professional power back, I highly
recommend you check out Own Your Money
and Own Your Career. Those are both of
my books. They're available hard
coverver. You can get them on Amazon or
like Barnes & Noble, Books a Million.
You can also get the ebook version if
you have a Kindle or a Nook. I believe
the Nook is the version of the Barnes &
Noble Kindle. I use a Kindle. Or you can
get the audio version, the audiobook
version. So, also if you have Spotify
premium, you can listen to Own Your
Money for free with your Spotify premium
membership. So, those books are really
amazing gifts. If you are going to give
someone a book, you might as well give
them something that they can learn from.
Um, I'm a little biased, but I think
they're fantastic. So, those are the two
quick housekeeping things that I'm
running through. As a quick update, as
you can see, if you're watching on
YouTube, um, I'm still at my parents
house on Cape Cod. I will be here
through the end of the year. I
apologize, the lighting is like a little
bit funky. Um, the sun is like directly
in my face, so I have the shade down.
There's a little bit of a shadow. Sorry.
Can't do anything about it. Um, but
hopefully the, you know, talking in this
video makes up for the strange lighting
going on. Anyways, let's get into the
juice here because I'm really excited
about this episode in particular just
because I think it's very tactical and
it's really helpful. Something that I
have found to be really challenging I
think just in the era of being online is
sharing any hard tangible milestones to
reach at certain points throughout your
20s just because people are so sensitive
about it. So before we get into these
financial milestones that I personally,
so this is my experience, my
perspective, um you know, take that with
a grain of salt that I think 20somes
should aim for at different periods. I
want to be super super super clear that
this is a guideline. Okay. So, I am
going to be sharing ages for the sake of
keeping this sort of structure and just
making it easier to set tactical goals
again because I'm finding that that
information is hard to find and I think
it's helpful um to have these tactical
goals to have the age ranges and to use
that as a guideline or a guiding post. I
think it's helpful, but they are not
meant to be rigid and they are not meant
to make you feel badly about yourself if
you don't match up to them exactly. So,
if hearing milestones and hearing ages
is going to trigger you or make you feel
upset, then I don't think this is a good
episode for you to continue listening
to. So, just keep that in mind. Um, and
with that, for those of you who are
interested in this, let's get into it,
cuz I think this is I I think it's
helpful. And I say all of that again to
not be like, you know, I I just want to
be very clear upfront. Um because I know
there are people out there who hearing
things like this can feel upsetting.
Anyways, we're going to go through the
five milestones and I have some notes up
on my laptop that I'm going to be
looking at and let's just get right into
it. So milestone number one is saving up
an emergency fund. And the ideal age
range for doing this is ages like 22 to
24. So this is really like that first
financial goal that you are focused on
when you graduate college. This is in my
opinion the most important financial
priority even before like paying off
credit card debt or anything of that
sort. And the focus is in your early
20s. So by age 24 25ish your goal should
be to have 3 to six months of living
expenses saved in a high yield savings
account. So I use Ally Bank as my high
yield savings account of choice. This is
not sponsored. I have just used Ally for
years and years and years. And the
reason why I like Ally is because they
have savings buckets, which I think some
other high yield savings accounts have
savings buckets, but again, I've been
using Ally, so like I'm not going to
switch to a different account
unnecessarily, but the savings buckets
make it really easy for you to segment
your various savings goals. So within my
Ally savings account, I have an
emergency fund and that has a little
less than 6 months of my monthly
expenses and I would say 6 months is a
threshold to aim for if you feel
uncertain in your job or you know you
want to pursue entrepreneurship as your
career path. If you feel comfortable and
confident in your job, 3 months is a
totally perfect goal. Um, I have six
months just, you know, because I work
for myself. So, if I, God forbid, you
know, my business were to go down the
drain or something were to happen or I
got hurt or whatever and I couldn't
work, I'd have money to sustain me to
hopefully bridge that gap before either
finding a job or getting back to work.
So, 3 months is a really great target if
you have a regular job. And then after 3
months, you can start balancing either
adding to your emergency fund with other
goals or move on to something else. To
figure out how much you need to save for
your emergency fund, you need to
identify your monthly spend. So, what
are you spending on your essentials and
your non-essentials on a monthly basis?
So, think about like rent, utility,
grocery, transportation, going out to
eat, going to the gym, all those kinds
of things. what's an estimate of what
that monthly outflow is. If you use a
tool like the personal finance dashboard
to track your expenses, this is a really
easy number to land on. If you don't
have a tool and you're feeling a little
bit lost, I recommend you get one. Um, I
also do want to say, I didn't say this
at the beginning, I do have a resource
library on my website that has both free
and paid resources, spreadsheets, and
budgeting apps, money management tools,
etc. of all varying degrees that I have
tried and tested and approved. So, if
you are looking for a tool, maybe you
don't want to use a spreadsheet, you
want to use something a little bit more
auto automated or digitized or whatever
that's connected to your accounts, go to
the resources linked in the show notes
here, and you can go through all the
ones that I, you know, again, personally
like. But to be able to find that
target, you need to know your monthly
outflow. And let's say you spend $5,000
per month, then your baseline emergency
fund should be $15,000. That number can
feel really overwhelming and really
cumbersome. I understand. Take it day by
day, week by week, month by month. Um,
again, the goal here is to have this
done by like 25. So, it's not going to
happen in the first 6 months. Hopefully,
it does. For some people, it will
depending on what you do for work and if
you're able to live at home and what
your situation looks like. But don't be
discouraged if it takes you, you know, a
couple of years to save up that amount
of money. That's normal for it to take
some time. Um, so aim to save $500
first, then reach $1,000. I think $1,000
should be that like bare minimum
baseline. $1,000 isn't really enough to
cover like big major emergencies or to
bridge the gap if you were to lose your
job or something, but it's a really
great first target to reach. And then
work your way up to that final goal. And
make sure again you're putting this
money in a high yield savings account. I
just want you to think about your
um emergency fund as like a financial
fire extinguisher. Okay? So I know that
this is not like a sexy financial goal.
I know it probably is hard to think
about prioritizing it when there are
likely other things that you want to be
doing, but think about it as the
financial fire extinguisher that is
going to help you put out a poor
situation should you find yourself in
one. Emergencies happen. Um, but it's
really designed to help again bridge the
gap if you lose your job or if you
happen to get into like a car accident
or your dog dies or your dog has to go
to the vet or something like these are
real emergencies that can be very, very,
very expensive. And if you don't have
the money set aside, it just puts you in
a little bit more of a precarious
position. So, this money that you put
aside in your emergency fund is not for
like a spontaneous weekend trip. It's
not to buy yourself a new phone. it's
for real emergencies. So again, keep
that in mind. And if it helps to list
out like what would constitute an
emergency just as a reminder like I
would go through that exercise because
emergency is subjective. So it's going
to feel a little bit different for
everyone. So again, milestone number one
is saving up that emergency fund and the
goal is to do this by the time you turn
25. Milestone number two is to start
thinking about your retirement savings.
So retirement does feel like a lifetime
away. I do also think a lot of younger
people um and I hate to do like the Gen
Z thing, but I do think a lot of Jenz
feels like they're never going to
retire. Retirement is impossible or
they're going to die before they retire.
The world is going to end before they
retire. And I totally get that. But that
also could not happen, right? like you
could very much so reached age 65 and
everything's perfectly fine and the
world just keep going to the world will
have kept spinning and you could have no
money because you didn't think about
retirement at all. Um so you know you
want to think about that because your
biggest wealthb buildinging asset is
time. So the age range to start thinking
about retirement again we're balancing
some of these goals here would be 22 to
26 27ish. By 26, 27, you kind of want to
have a good cadence with your retirement
savings. Ideally, you would do that
earlier, but by 27, you know, having a
percentage of your money going towards
your retirement, really being able to
think about not necessarily maxing out
your retirement accounts, but increasing
your contributions year-over-year.
That's a really great target. So, at 22,
like when you're first starting a job
or, you know, whatever age you start
your job, maybe you went to grad school,
so you're starting at 24 or 25. Again,
totally fine. But at your first job, you
want to be contributing, I would say 1
to 2% from day one towards your
retirement account, regardless of if
your company matches. If your company
matches, then you want to aim to at
least get the full company match, no
matter what. So, let's say that your
company will match your retirement
contributions up to 3%. Then you want to
make sure you're contributing at least
3% towards your retirement the first day
you start working. Whether you start
working at 22, 23, 24, 25, 26 does not
matter because that is free money in
your pocket. If you can't do the full
amount of the match, then you know 1 to
2% or half of the match good target. But
if you can get there and it's not
inhibiting your ability to eat, then I
recommend you start with that free
match. By age 26, if you started working
at 22 and you see a little bit of like
that linear job progression, which
people see that 10% 11% is a great goal
to get to. When I was in my corporate
job, every year I would increase my 401k
by 1%. It was a very, very minimal
change in my take-home pay. I didn't
even really feel it or notice it. But
obviously long-term that small increase
when it's in the market and it's moving
over time can make a really big
difference significantly more than just
1% of a difference. So really think
about how you are going to be increasing
your retirement contribution throughout
your 20s and into your 30s. Obviously, a
great goal as you get older and start
earning more is to meet those annual
maximums on your 401k or your IRA or
both if you can afford to. But
increasing it year-over-year 1% 2% 3% if
you're feeling good is great. And really
having these targets of like by age 26 I
want to hit 10% or by age 28 I want to
hit 10%. Again, these are, you know, put
them in the context of your own
situation, but having those targets is
really, really helpful to just make
those year-over-year adjustments.
Moving into milestone number three, this
is where you're thinking about your
credit score and building your credit
foundation. And this is something to
start thinking about in like your
mid20s, so like 25 to 27. Those few
years after college is really focused on
the basics and just getting things set
up. obviously would love to have a
credit card again in college right when
you graduate college, but pick and
choose your battles. So, if that feels
overwhelming to you, then I wouldn't
worry about your credit until maybe a
little bit later because there are other
ways that you can build credit without
using credit cards. But the goal is to
start thinking about your credit score
because your credit score is like your
adult GPA. So, the age range that I have
tagged on here is 25 to 27 because
again, early 20s, you're focused on
building up that emergency fund and
making sure you're hitting those very
minimum retirement contributions so you
can get your money working in the
market. By your mid20s, hopefully you're
feeling a little more grounded with
those first two milestones and you can
pivot to optimizing a little bit and
that's where this credit conversation
starts to come into play. It really does
matter what your credit score is,
especially if you want to get approved
for an apartment on your own. Um, get
approved for a mortgage if you ever want
to buy a home. Get any type of loan like
a car loan. Sometimes even job
background checks will check it. If
you're getting approved for apartment um
for an apartment, they will check your
credit. They will do a background check
on you. So, those are really important
things to keep in mind if you want to be
like a functioning independent adult in
society without needing to have a
guarantor or a co-signer on things,
which there's nothing wrong with those
things, but not everybody has that. So,
it's important to make sure you're
taking these steps to mitigate any
issues that could come up in the future.
So, the goal is by 27 to have what's
considered good credit. So, good credit
would be a score of 700 or above. So,
how can you do this? And there are three
key strategies that you can implement.
First would be ensuring from the get-go
you are always paying your bills on time
because paying your bills on time like
utility bills and your rent and
everything and making like student loan
payments those all impact your credit
score even if you're not using a credit
card. Obviously if you have a credit
card and you're putting money on it and
you're paying that off on time every
month that is going to help improve your
credit score and show like a long credit
history. But if you don't have a credit
card, you can still build credit either
through like showing proof of payment
for your utility bills. You can open up
a secured card to make those payments.
There are tons of online resources where
you know you can build your credit in a
more secure way. But overarchingly, you
want to make sure you're paying all of
your bills on time so that nothing is
going to collections because that again
will impact your credit score if you put
anything on your credit card. So now
we're going to talk about like smart
credit habits. If you're using a credit
card and you're putting anything on that
card, you want to make sure you're
paying it off in full and you're never
ever ever carrying a balance. And that
is I think like the most important thing
to think about when you are building
credit or opening a credit card. Never
use those buy now pay laters. Um I don't
think you need to use a CLA or anything
of that sort. If you don't have the
money to buy something in full at that
time, just don't buy it. save up for it
and then put it on your card when you
have the cash and then pay the card off
right away. But paying your bills on
time is obviously going to really help
get that score up. The other two things
are keeping your credit utilization
under 30%. So this is the percentage of
your credit line that you use and 30% is
really the top of what you should be
using on a month-to-month basis. So, you
can check your credit line with your
card issuer or with a tool like Credit
Karma that will pull all of your
different cards in. Credit Karma,
Experian, both great resources. They'll
pull all of your cards in. You can see
your full credit line if you have more
than one credit card. Um, but for
example, let's say you have a credit
line that's $5,000. 30% of that would be
$1,500. So, on average, you wouldn't
want to be putting more than $1,500 on
your credit card per month. And then the
last tip here is to make sure you're not
opening too many lines of credit at once
or getting too many hard inquiries at
the same time. Each credit card that you
open up is a hard inquiry on your credit
and this can temporarily reduce your
score. So if you are opening a lot of
credit cards, you're getting a lot of
inquiries on your credit report. That is
going to like be a warning sign to
issuers or um lenders that you know
you're opening up a lot of cards. it
could be a red flag that you need access
to quick cash and you know then in the
future that could impact your credit
score may not be possible for you to get
loans and all that kind of stuff. So be
aware of that. Um you know one maybe two
credit cards a year is like kind of the
most. All that to say your credit is
really important. The focus for your
credit to really boost your score above
700 is in your mid20s. These are all
things you can also be doing
simultaneously just as like a cognizant
person in your early 20s if you're just
practicing good credit spending um
credit card spending habits and you're
paying your bills on time like you're
building and boosting your credit before
this mid20s point anyways. So by the
time you reach 25 26 27 like your credit
score is probably already going to be
fine. Um, but if you're focused on other
things in your early 20s, then this is
something to pay attention to when you
reach that mid20s point. Moving on to
milestone number four. This is where
things start to get a little less like
foundational and a little bit more fun.
These last two are more about investing
and growing your wealth beyond just
these basics like um beyond the basics
of just retirement, 401k stuff, and then
saving up an emergency fund. So
milestone four is establishing more than
one stream of income. And this is more
of a later 20s milestone. So think like
27, 28, 29. At this point in your 20s,
again, if everything was linear, which I
know is not how everybody's life is. If
everything was linear by that point in
time, maybe you've been in your
corporate job for a couple of years and
you're feeling good about your
retirement and you're approved for your
apartment. Maybe you own a home, I don't
know. Um, you could be thinking about
getting married or maybe you're not
getting married at all. I'm not at this
point. So, you know, it just really
depends on your life situation. But
later on in your 20s, a lot of people
tend to feel a little bit more
established in their lives. And so, this
is when you have the brain capacity and
space to start thinking about more than
one income stream. So, that could be a
part-time job or a side hustle in
addition to your corporate job. It could
be thinking about entrepreneurship.
Like, there's so many paths here. But
diversifying your income makes it
possible for you to not only continue to
build just like general wealth and build
up that financial foundation, but it can
allow you to add more and more savings
and investments to your broader
portfolio and just expand your reach and
expand the opportunities that become
available to you. So having a day job is
great, but I think we've seen too over
the last year that the job market is
fairly unsteady. And even jobs that have
traditionally been considered not even
recession proof, but just like reliable
are no longer that. And people are
getting laid off with no warning. They
have no idea it's coming. I've seen lots
of my friends get laid off. I've seen
people in my family get laid off. I've
seen emergencies happen. And so it's
important I think to keep in mind that a
job like a nineto-ive job that was
traditionally considered reliable and
like a real job is not that anymore
unfortunately. So it's unfortunate that
having an additional income is becoming
a little bit more of a requirement as
opposed to a choice. But rather than
looking at it as a chore or something
that you have to do, I think it's a
really great thing to look at as an
opportunity um because not only is
additional income something that can
help you build your financial foundation
like I mentioned, but it's also an
opportunity to learn and develop new
skills and potentially explore an
additional career path. And so I'll use
myself as the example here, but Break
Your Budget has totally changed my life.
Not only in the sense of it's allowed me
to grow my wealth and create the sense
of control and freedom over my life, but
I've learned actually so much from doing
this. And if I were to return to a
corporate setting, which my mind is
open, I may do that. I hope to not, but
it's something that who knows what my
life holds for me, right? Like I don't
know. If I were to return to a corporate
setting, I would probably pursue a
different type of job than what I did
before I quit my job a couple of years
ago, just because I've learned a totally
new set of skills. And so, I've just
discovered this part of me that I didn't
know existed through my side hustle
that's created extra income for me. It's
allowed me to develop different skills.
It's opened my eyes to different career
paths, and I've just learned so much. So
I would have never been able to reach
that point if I never did this. So think
of a side hustle as an opportunity for
you to like lean into a passion or
explore an area of interest. So for
example, my side hustle that I'm, you
know, planting seeds for, thinking about
when I move to Chicago is to potentially
get a job working at a coffee shop like
as a barista because I really want to
learn the coffee business because it's
something that I potentially want to
pursue in the future. But I've never
worked a job like that. I don't know how
coffee shops run. I don't know the back
end. I don't know the business. I don't
know the profits. Like, it's something
that I need to learn about. And so,
instead of looking at getting like a
little part-time job as a chore or as
something that's like annoying, I'm
looking at it as this is a cool
opportunity for me to learn something.
And if it ends up being not what I want,
like that's totally fine. There's no
pressure there. And that's the beauty of
additional income streams is they at the
beginning at least are low stakes, low
pressure. Um, so and usually when you
put not a lot of pressure on it, that's
when you're able to actually evaluate a
opportunity or a situation for what it
is as opposed to it being like this
really stressful thing. So think about
what a potential additional income
stream could be for you. And a few
examples would be like a freelancing job
or a part-time job. I have a friend who
she has a full-time job and she also
works part-time at Free People as like a
sales associate and she has a little
community there and she's met tons of
girls and she gets a discount on the
clothes and it's a couple hours a week
and it's totally great, right? Like I
don't think there's any shame in that
and I as much as I hate to see the
corporate world be so greedy and like
you know ruin people's lives honestly by
laying them off in the middle of the
night with no warning and no severance.
What I am finding to be the silver
lining about this is it's normalizing
different job opportunities in different
career paths where I think that's really
valuable. I think it's so valuable to be
able to pursue other things without
judgment, without shame, just because
you're interested in it. So, I don't
know. I think there's a silver lining
there. And I think changing the way that
you view part-time work or side hustles
or freelance work will do a lot of
wonders for exploring those
opportunities and finding new ideas. So
to reiterate, the goal isn't just extra
cash. It's building financial resilience
and it's providing you the opportunity
to explore some of your passions which
again is so so valuable especially in
your 20s. Moving on to the last
milestone here, milestone number five.
This is again later 20s, so like 27, 28,
29, and then getting into your 30s would
be investing beyond retirement in making
different investments that aren't just
in a 401k or an IRA because I feel like
at least in the personal finance online
space, we see a lot of conversation
around IRA and retirement accounts,
which is very important. Um, but
brokerage accounts and other types of
investments totally get demonized
because they're not tax advantaged. But
when you have all of your money in tax
advantaged accounts, you can't access
those accounts without penalties or
without fees until you retire. So there
is a lot of value in having
non-retirement investments for those
either shorter or mid to longterm goals.
I know that was like short, mid, and
long goals, you know, but it's different
different reasons why you would invest,
I guess, beyond retirement. So, like for
example, I have money in a brokerage
account that I don't necessarily plan
anytime soon to use. But if I were in
the next couple of years to buy a home,
I may draw down from those accounts
depending on, you know, what my other
accounts are looking like, my financial
situation, what the market's looking
like. But that's money that I can access
for different purchases or different
events in my life. Whereas, if that
money was in a retirement account, I
wouldn't be able to use it for a
purchase of that sort. So graduating
from retirement accounts to broader
investments is something that I
recommend you do when you're ready and
like the element for being ready is
you've got your retirement accounts on
lock. You're able to actively contribute
to those. You have an emergency fund,
you're feeling comfortable at work. At
that point, you don't have any debt or
credit card debt. Student loan debt,
that's a little bit different or like
maybe a car loan or something, but you
don't have any credit card debt or super
high interest debt. At that point, it's
a great time to start thinking about,
okay, maybe I have some additional
income or some discretionary income that
I'd like to put towards different types
of investments. This is where the
brokerage account and non-retirement
investing goals come into play. And the
reason why I place these at your late
20s is because usually it takes you all
of your 20s to, you know, pay off credit
card debt if you had it, to start
actively contributing to those
retirement accounts, to get your
spending underway, to start paying down
student loans or a car loan or something
and like really get your finances in
order. I think a lot of people don't
reach a point where they're comfortable
to invest beyond that until they're 28,
29, and even into your 30s. Maybe you're
not even there yet. And that's normal.
And part of again why I wanted to add
age ranges on here is because I think
it's important to talk about how
you can do things for your finances
later in life. Like you don't have to do
everything by the time you turn 25,
which is not something that we see a lot
on social media. And I mean I've
definitely contributed to it because I
use that hook of I saved 100K by the
time I was 25. That's marketing. It's
true, but it's marketing. And I think
it's important to remember that that
these big numbers are attention
grabbers, okay? And it's not normal for
everyone. And generally, myself
included, which I've discussed, there
are some extenduating circumstances to
being able to reach those points. For
me, I lived at home for kind of about a
year during CO and that obviously made a
big difference in my ability to save up.
I did reach that milestone before um
like before co like I moved and
everything but you know there are again
things that help bolster that number um
for me and for pretty much everyone else
who has said it because a lot of the
people who do claim that like I have
relationships with and I've spoken to
and you know it's I my point is it's
important to remember that when you see
these big milestones there's always more
to the story and they're outlier
situations. So reaching the ability to
invest beyond your retirement account at
a later date is normal like it takes
time. So the benefit of investing beyond
retirement accounts is that you know you
have some more accessible assets with
fewer restrictions. So that goes back to
that point about retirement accounts
being tax advantaged. When they're tax
advantaged there are restrictions around
what you can access and when. Um, but it
also allows you to diversify your wealth
across different types of investments.
So these different types of investments
could be individual stocks, emerging
markets, real estate if that's something
that you're interested in. And they can
help you achieve those medium to longer
term goals. So like I mentioned earlier
too, buying a home, maybe starting a
business, funding any type of major life
purchase. Again, that's going to vary
person to person, timeline to timeline.
Everything is going to look a little bit
different for each individual person.
And that's totally fine. But the primary
goal of investing beyond retirement
accounts is to create that broader
financial portfolio that provides
opportunities beyond just the
traditional retirement planning that we
are force-fed, which is super important
but not the only thing to think about
because you can only access funds in
your retirement account at retirement
age. And again, it demonizes brokerage
accounts and other investment
opportunities because those aren't tax
advantage. So, I like to think of the
difference between retirement accounts
and like brokerage accounts as with
retirement accounts, whether you're in a
Roth or a traditional, you're either
taxed on the way in and can withdraw
tax-free on the way out, or you
contribute taxree on the way in and then
you pay taxes on the withdrawals on the
way out. With brokerage accounts, you
are contributing taxed income because
it's income that you receive after you
pay taxes on it. And then when you
withdraw that money, you're also paying
capital gains tax. So you're taxed on
the way in technically and you're also
taxed on the way out. So it's just
important to remember that those are the
key differences, but the benefit is the
flexibility and the ability to access
funds. And also there aren't limits on
how much you can put into a brokerage
account. So you know with retirement
accounts, 401ks, you have contribution
limits. And maybe you're having a really
good year or you've had a really good
couple of years and you've maxed those
accounts out and you still have money to
invest. like you want to get that money
moving in the market depending on your
goals. So there is definitely a place
for brokerage investing and other types
of investing in your financial strategy.
It just doesn't have to be something
that you prioritize in your early to
mid20s. It could be something that you
think about in your later 20s. And
again, that's okay. You still have
plenty of time at 28, 29, and 30 to put
money into different types of accounts.
So, the key with investing beyond
retirement and but really investing at
any point in time is just consistency.
You want to be consistent. It's okay if
it's only $50 or $20 or $100 or
whatever. You want to build the habit of
investing and making those investments.
And you'll learn by doing and there are
lots of resources online. I also have a
free investing guide which I'll make
sure is linked in the show notes. And I
also talk about this a lot inside Own
Your Money. There's a whole chapter on
investing and scenarios and investment
types and an investment glossery and
like lots of information on this. So,
leverage those resources and make
empowered decisions. Um, because again,
as you go throughout your 20s, the goal
is for your wealth to grow long term.
And you do that by diversifying your
accounts, diversifying your positions,
and really thinking strategically about
what those goals are. Anyways, I hope
this was helpful. I'll do a quick
summary here. So milestone number one,
saving up an emergency fund. The goal is
to do this like 22 to 25ish. Milestone
two would be thinking about retirement
account. That's going to be the same
early 20s age, like 22 20 to 25, 26. Um,
moving on to milestone number three is
building up your credit score and really
hitting that good credit, which is a
score of 700 and above. And that's
something to focus on throughout your
20s. But, you know, 25 to 27 is a good
target. by 27, you want to have good
credit. By moving on, moving on to
milestone number four. This is where
you're thinking about diversifying your
income and hopefully adding in an
additional income stream. This is
something to think about in your like
mid to late 20s. So, 26, 27, 28, getting
into your late 20s. And then my also
number five is investing beyond
retirement. Great place to do this or to
start thinking about it is in your late
20s. But obviously for all of these, the
earlier the better. Anyways, just keep
in mind these milestones are not a
strict checklist. They're guidelines and
everyone's financial journey is going to
look a little bit different. But the
most important thing you can do is to
just start now at whatever age you're at
listening to this episode. So, I hope
this was helpful. Um, if you have
questions about anything, obviously, let
me know. Remember, personal finance is
very personal. Your path is unique. And
yeah, I'll catch you next week in the
next