Essential Financial Lessons Learned in Your 20s

My 20s taught me a lot about money management. Here are some of my biggest takeaways.

A lot of us look back on our 20s and shudder. I enjoyed my 20s. During the early part of that decade, I lived on my own in a big city and enjoyed the perks that came with it. Later in my 20s, I got married and spent a lot of time traveling with my husband before children came into the mix.

I learned a number of important things in my 20s, and that extends to money-related matters. Here are a few big financial lessons I came away with.

1. Always have emergency savings

I lost a full-time job during my 20s through no fault of my own -- the company was starved for business and there just wasn't enough work to keep me busy and justify paying my salary. I was crushed and stressed, but thankfully, I had emergency savings to fall back on. Since then, I've made it a point to boost my emergency fund so I always have plenty of cash on hand for a rainy day. My limited savings at the time helped me get through that shaky period, and now, I have a larger cushion to fall back on should my income get slashed without warning.

2. Avoid unhealthy debt at all costs

I spent a good part of my 20s consoling friends who were hassled by debt collectors wanting them to make good on overdue bills. I guess you could say that irresponsible friends were a blessing -- it taught me early on that carrying a credit card balance is bad news. I'm proud to say I've never charged an expense on a credit card I couldn't pay off in full when my bill came due, and that's helped me avoid expensive interest charges I have no desire to get stuck with.

3. Have the right insurance

One day during my 20s, I was doing something innocent enough -- snacking on hard candy -- when I broke off part of my tooth by biting down the wrong way. I didn't have dental insurance because my employer didn't provide it and I didn't want to pay for it on my own. I ignored the problem. My tooth didn't hurt, and I knew going to the dentist would be expensive.

A few weeks later, I woke up to terrible pain. The broken tooth was infected, and I needed a (very expensive) root canal. I expressly remember crying -- not over the procedure, but the bill. I learned then that the right insurance goes a long way.

Years later, when I lost a job, I was tempted to go without health insurance due to the expense. Then I remembered that tooth incident. I forked over the money for COBRA and stayed on my old plan until I got married, when I jumped on my husband's plan. During those five months paying for COBRA, I wound up in the emergency room. Had I not purchased that insurance, I would've been stuck with thousands of dollars in bills. Instead, I made a $100 copay and moved on.

My 20s were certainly an interesting period, and sometimes, I miss being younger and more carefree. But I'm happy to say that I came away from my 20s with some important financial knowledge under my belt that has helped me avoid money-related stress ever since.