What Does the Average 20-Something Know About Money?

If you haven't already heard, a lot of people think that millennials are bad at money. In fact, back in 2014, The Wall Street Journal stated that adults under the age of 35 had a savings rate of negative 2 percent.

Instead of taking that at face value, we thought we'd just ask 10 young adults in their 20s how they manage their finances and what they know about money. The results? Pretty lit.

Cody Steele, 29, Project Manager
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Cody Steele, 29, Project Manager

  1. What is the biggest purchase you've ever made?
  2. $15,000 car when I was 19. Had to finance that bad boy and learned that lesson early on. I’ve bought my vehicles outright ever since.

  3. Are you currently saving for retirement?
  4. Sort of. I may end up using the amount I’ve saved into my account as a down payment on a home. I simply don’t have enough in my other accounts for a down payment and if the right deal comes along I’m just going to pull the trigger on purchasing a property.

  5. Do you invest?
  6. Not in the traditional sense, I have never chucked money into stocks or mutual funds. If I’m going to gamble I prefer a more exciting and enjoyable way for me — I play poker. I’ve studied the game via training videos and books and my ROI is around 5 percent over the past decade. I probably could have made more money investing in the market, but I value the enjoyment of the game.

  7. Do you have an emergency savings fund?
  8. Yes, but she’s petite.

  9. Try your best to explain "interest rates."
    An interest rate is either the fee you pay to borrow money, or the award you’re given for lending money. When you put your hard earned money in the bank you’re actually lending it to the bank, so that they can in turn lend it to other people. The kicker is, they give you less in return for giving it to them, than they’ll charge the next guy for borrowing it from them.
Alessandra Uifalusi, 26, Student
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Alessandra Uifalusi, 26, Student

  1. Are you currently saving for retirement?
  2. Haha, oh man! No. I know that sounds bad. I guess I've been putting it off for when I finish my degree and start my career. I suppose that's because I've always considered that a "grown up" thing to do, and I only consider people with careers and plans "grown ups".

  3. Do you invest?
  4. I guess I invest in my future since that's where all of my money goes. I have also already started saving for my first home. I anticipate that I will be buying a condo in about three years from now. I just want to start my career before I get into any serious financial commitments. Unfortunately, right now I don't have the time to properly research the benefits and costs of the different investments available to me.

  5. Do you have an emergency savings fund?
  6. Oh yeah, 100 percent! I have terrible luck! Over the years I've learned that money really does solve your problems. Forgot your lunch at home? You need money to buy something at work. Did you not pay attention to where you were parking and get impounded? Guess what, you need money to get it out of the lot! Did you fall and break a leg when you should have really just rolled your ankle? Your basic expenses don't just suddenly change if you're suddenly out of work!

  7. Do you use a budget?
  8. Yes. I use this wonderful app called Mint. It connects to all of my cards and banks and shows me how much I'm spending, earning, and how much I've gone over the budgets I've made.

  9. Try your best to explain "interest rates."
    Tiny invisible creatures that invade your savings and debts and increase each by prespecified dollar amounts. When applied to your debts, they really suck!
Raj Lall, 26, Student
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Raj Lall, 26, Student

  1. What is the biggest purchase you've ever made?
  2. The biggest purchase I have ever made was my vehicle three years ago. It is a 2007 Lincoln MKZ and it cost me $12,000.

  3. Do you invest?
  4. I have invested in a home with my brother. We are planning to sell it once we find a decent buyer that can meet our demands.

  5. Do you have an emergency savings fund?
  6. I consider my emergency fund to be my savings account. I haven’t had to use it yet in any circumstance.

  7. Do you use a budget?
  8. I do not have a set budget although I have been careful with my money since I was laid off from my job two years ago. I try to pick and choose wisely with spending depending on the situation at that given time.

  9. Try your best to explain "interest rates."
    An interest rate is the rate of which you will be charged once a loan or any type of money has been borrowed from a bank or even the government.
Maria Georgescu, 21, Actress
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Maria Georgescu, 21, Actress

  1. What is the biggest purchase you've ever made?
  2. I just impulsively bought the iPhone 7 for Christmas. I mostly wanted it for the amazing camera quality. I had to sign up for a two-year contract to pay it off which made me kind of nervous, but I’m hoping I can buy it out eventually. I’m trying to be ultra careful with it, but can’t help my occasional butter fingers.

  3. Are you currently saving for retirement?
  4. I honestly have not even thought about saving for retirement. I’m thinking really short term right now like saving for trips and music festivals. I just moved to Vancouver and am struggling to save up for rent every month. I would like to start saving within the next five to 10 years, depending on my career path.

  5. Try your best to explain a "credit score."
  6. I just got a credit card for the first time last summer so I believe it is a way for the world to know how good you are at paying off your debts for all kinds of things (rent, cars, credit cards). I know my landlord asked for one, probably to prove that I could pay the rent every month.

  7. Do you have an emergency savings fund?
  8. I don’t have anything in my savings funds yet because I only just started having a serious job three months ago with a legitimate salary. I feel as though I only now am settled enough to start thinking about such things.

  9. Do you use a budget?
    I try to keep track of when all my payments come out so that I am always prepared, especially for rent and car insurance. The most I budget for is food and fun during the week. I try to spend around $30 on groceries and then another $30-40 for going out. I have been starting a gas and commute budget as well because I want to make sure that I’m making the best choices in that department.
Nick Davies, 28, Marketing Coordinator
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Nick Davies, 28, Marketing Coordinator

  1. What is the biggest purchase you've ever made?
  2. My biggest purchase, although not bought in full (yet), would be my vehicle. The cost was around $33,000 in 2013.

  3. Are you currently saving for retirement?
  4. Yes, I am currently saving for retirement, and have been since 2012. I have become a lot more aggressive with regular contributions to retirement savings in the last couple of years since becoming more knowledgeable about personal finance. An ideal number is not yet concrete, but I’d like to have financial independence by at least age 50, if not sooner.

  5. Do you invest?
  6. Yes, I plan to max out my yearly savings account, and I also have group retirement contribution in mutual funds through my employer. I also have two separate accounts through Wealthsimple that I started about a year ago. In 2017 so far I have upped auto contributions significantly.

  7. Try your best to explain a "credit score."
  8. A credit score reflects your accountability and "record" of any payments towards outstanding debts that you have owing. It also reflects the amount you have borrowed weighed against the total amount available for you to borrow on credit.

  9. How many credit cards do you have and what do you primarily use them for?
    I have three credit cards in total, one of which is a joint card with my wife. We use our joint credit card for everything that applies to household purchases or expenses. I use the other two primarily for things like parking, online purchases, cell phone bill, or monthly memberships.
Amoy Hudson, 25, Distribution Agent
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Amoy Hudson, 25, Distribution Agent

  1. Are you currently saving for retirement?
  2. I'm not currently saving for retirement, but I know I should be. If there is anything I have learned from my friends who are older than me is that I should be making regular contributions even if it's not much because I'm still young. I plan to start soon, but I'm just in that awkward stage of transitioning from being a full-time student to a full-time adult.

  3. Do you invest?
  4. I don't currently invest because I'm focused on cleaning up my finances (consumer debt) and creating a budget that works for my lifestyle. I would definitely consider investing in the future. I think the only thing holding me back right now is finding the proper time to do my research on the different types of investments and deciding what level of risk I'm comfortable with.

  5. Do you have an emergency savings fund?
  6. I do have an emergency fund and it has come in handy so many times! Always good to have some extra money to cover unexpected events such as, car repairs, unemployment, or just anything you didn't plan for. My emergency fund used to be enough to cover my expenses comfortably for three months, but having found myself unemployed earlier this year three months came and went really fast, so I have bumped it up to five months. I figure it's better to have more than not enough in the future.

  7. Do you use a budget?
  8. I do use a budget, but mainly because I used to get paid monthly and there's nothing worse than getting halfway through the month and your bank account is empty. My budget is just basically my paycheck minus my fixed expenses (cellphone, loan payments, insurance, bills, etc.) and then I allocate a certain percentage of the remaining funds to food, gas, and leisure. Number-one lesson I've learned with making a budget is you need to be realistic with the numbers!

  9. How many credit cards do you have and what do you primarily use them for?
    I have two credit cards, but I only use one. The credit card I don't use I keep because it has a large limit amount which has come in handy when booking travel arrangements. I use my other credit card for online purchases and to buy gas (spare me the walk inside the store haha).
Kyle Wilson, 25, Associate
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Kyle Wilson, 25, Associate

  1. What is the biggest purchase you've ever made?
  2. I co-bought my first house with my sister in 2014. The down payment was funded through a business we started when we were teenagers and had saved up our profits for a number of years. We are still currently in that house where we also have tenants that help us pay the bills.

  3. Are you currently saving for retirement?
  4. Yes, I am. I have been for about four years now, however, it has been hard to keep up with regular deposits into those accounts. Ideally, I'd love to retire before I'm 60, but I've yet to really take the time to plan it out and see what kind of steps need to be taken in order to make that happen.

  5. Do you have an emergency savings fund?
  6. Yes, and no. I have funds that could be used in the case of an emergency, but they are not exactly easy to access within a day or two if they were required immediately. It's definitely something that I should put some more focus on, especially being a homeowner which could require some expensive emergencies.

  7. Do you use a budget?
  8. Yes, I try to use a budget, however, I'm better at the budget planning that I am at the monitoring and ongoing assessment of the that plan. I used to do my plan on a monthly basis, but for 2017 I am trying a bi-monthly budget which lines up with my pay periods instead of on a month by month.

  9. How many credit cards do you have and what do you primarily use them for?
    I have one credit card for which its primary use in the last year was to fund a vacation, which I am still paying for. Once it is paid off I plan to use it for things like groceries and gas and just pay off the balance every month. It is taking longer to get to that point than I thought it would.
Samera Kadri, 24, Instructional Design
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Samera Kadri, 24, Instructional Design

  1. What is the biggest purchase you've ever made?
  2. The biggest purchase I ever made was my car. I scraped together basically everything I had when I bought it, so it's nice looking back and knowing I'm not in that position anymore.

  3. Are you currently saving for retirement?
  4. I've been saving for retirement for about a year now. It's not my number-one priority because I'm hoping to put a hefty down payment on a house this year and buy a new car. I feel like that holds me back from making regular payments into a retirement account.

  5. Do you invest?
  6. I just started investing this year with the help of my father. Just baby investments so far. It would be nice to be able to supplement my income one day with good investments. I actually have no idea what I'm talking about when it comes to investing so I don't talk to adults about it for fear of sounding like an idiot.

  7. Try your best to explain a "credit score."
  8. A credit score is a numerical value you get based on how well you've been able to pay off your debt in the past. Basically it shows the bank how well you've been able to pay off loans which determines how much you'll get in the future.

  9. Do you use a budget?
    I started off budgeting with an Excel spreadsheet that I intended on filling out once a month. It ended up being more of a baseline for how I want to spend my money and since then, I've just set up automatic payments from my main account into three different saving accounts. It works really well for me because it's out of sight, out of mind. And it feels really good to be paying myself for things I want in the future.
Branden Arthur, 28, Architectural Tech
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Branden Arthur, 28, Architectural Tech

  1. What is the biggest purchase you've ever made?
  2. My house, which I bought with a friend as an income property. It was $320,000.

  3. Are you currently saving for retirement?
  4. Yes, I am saving. I've been saving for the last year and a half. I am aiming to retire at 65 and to have $2 million in the bank. As I make more money I hope to accelerate the timeline.

  5. Do you invest?
  6. I invest for retirement in a global equity fund. I also have an account that I save for emergencies, large purchases, or trips (in that order).

  7. Do you have an emergency savings fund?
  8. Sort of. I have my general savings, but it isn't substantial. I aggressively pay down my debt with most of my discretionary income.

  9. Do you use a budget?
    I use the Mint app for all my budget tracking. I love using it.
Ashley Heavenor, 22, Nurse
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Ashley Heavenor, 22, Nurse

  1. Are you currently saving for retirement?
  2. I am not currently saving for retirement. I have thought about starting for a couple years now but have never followed through. I will start one soon, as I am now graduated from university and will have more of a cash flow coming in. Until now I have only had summer jobs and that money has typically gone straight to gas and groceries.

  3. Try your best to explain a "credit score."
  4. A number that tells the bank how likely you are to pay your bills and pay them on time. They will use this number to determine whether you qualify for more credit or for a loan and how much interest they will charge you.

  5. Do you have an emergency savings fund?
  6. I do. I have always saved at least $1000 from my summer job earnings. It’s not much, but I like to have this money aside just in case something happens and I need it. Not really sure what would have to happen for me to take that money out, but it's there. Just in case.

  7. Do you use a budget?
  8. I am a little bit flaky when is comes to budgeting. Seeming as I have not had a consistent flow of cash coming in and I have relied on my parent’s donations up until this point, its hard to plan how much money I will have at any given point. But I basically have four categories where my money goes (rent, gas, food, extras) and I keep track of how much money goes to those categories. When I get married this spring and have a job with consistent paychecks I will have to shake this bad habit.

  9. How many credit cards do you have and what do you primarily use them for?
    I have one credit card and I primarily use it for gas or online purchases. Other than that it doesn’t come out much.