Money lessons I learned the hard way

Moneying isn’t easy. When you’re young, you jump at any opportunity to blow your cash. And sure, flavoured vodka seems like a great idea for your spare change in high school, but it leaves you with a lot of savings regrets in your twenties (more on that later).

Sometimes money lessons are taught by helpful friends or family members. But a lot of the time, you’re stuck learning lessons the hard way.

I’ve recently overhauled my savings lifestyle and spent a lot of time reflecting on what I’ve learned from the mistakes I made in the past decade. For example, I really regret not learning about the repayment terms of my student loan after I graduated — a mistake that ended up hurting my credit score.

Here’s a look at my financial journey, all the way from having a paper-route as a kid to saving paper in my twenties.

If I want to make money, I have to work hard

Like most kids, this concept took me a while to really wrap my head around.

My parents divorced when I was very young. My older sister and I lived in the suburbs of Toronto with my mom, her new husband, and his three kids. Our house was a busy (often hectic) place, and with so many kids running around we didn’t always get everything we wanted. It was tough for me to understand why my friends got new clothes every season while I was wearing hand-me-downs.

My mom taught me early on that if I wanted the stuff my friends had, I’d have to get a job and buy it myself. So I did. I started delivering newspapers (remember those?) when I was only nine, and I got a job as a restaurant hostess at 13. Now that I think about it, that very well could have been a labour law violation. Oops?

Since then, I’ve never not had a job. At times, I’ve even had two or three.

And another lesson from my mom? Never quit a job until you have another one. Because if there are things you want, you need money, and if you need money, you gotta work for it.

Knowing what to do with money is just as hard

Earning money has always been the easy part for me — it’s managing it that’s been tricky. For instance, I always knew I’d go to university, though I didn’t realize just how expensive it was going to be or how the hell I’d pay for it.

I’m kind of embarrassed to admit that I made enough money in high school to have paid for at least a few years of university. But did I save any of it? Of course not. I spent my money on what’s important to (almost) all 16 year old girls: clothes, shoes, and flavoured vodka. When I think about how much cash I blew on Smirnoff Raspberry, I cry a little inside. But hey, it’s a lesson well-learned.

Paying for school sucks

I’m sure this won’t come as news, especially to those stuck paying back student loans, but affording post-secondary education (without much help from The Bank of Mom & Dad) is the worst. Not only is tuition stupidly expensive, but there are so many other expenses to consider. Let’s face it: most students are ill-equipped to deal with real life money responsibilities.

After high school, I moved from the suburbs to downtown to attend Ryerson University. I lived off-campus with roommates and had no choice but to apply for OSAP. Unfortunately, OSAP has funny (read: frustrating) policies and I didn’t qualify for as much money as I’d hoped. This meant I had no choice but to get a student line of credit.

You’d think I’d have learned from high school about mindless spending. You’d be wrong. My Ryerson days consisted of dinners out, buying crap I didn’t need, and of course lots of partying. A true student, I was.

Sadly, all of this meant graduating with more debt than I care to admit - debt that I’m still paying off so many years later. The worst part? I’m not the only one. The average student in Canada graduates with $27,000 of debt.

While some of the new education funding reforms in Ontario will make post-secondary more accessible to students coming from low income families, I worry that students from middle class households may still struggle to secure (and pay back) the funding they need, much like I did.

I should’ve started planning for my future five years ago

A few years after graduating, I thought I was actually doing pretty good with my money. I was paying off my loans as quickly as I could, living within my means, and not carrying a credit card balance into a new month.

Then I started working for LowestRates.

One of the best parts about working at a FinTech (that’s financial technology company for those not in the know) is that everyone is basically a money nerd, so you absorb a lot just by being around the office. That’s how I found out that I was still pretty clueless when it came to finances. Do most people at age 25 understand RRSPs and TFSAs? How about investing? Or why compound interest is so magical? I had no clue.

After chatting with the team one day, I realized I probably should’ve started saving for my future five years ago — and I kind of freaked out. I made an appointment at my bank for that week, opened up a TFSA, and moved all of my savings into it. Now I’m working on banking 10% of my income.

It was just another money lesson I learned the hard way. And while I wish someone would’ve told me these things sooner, learning by (not) doing is learning you can bank on.