How to Manage Your Money in Your 20s

7 min read

Today, I want to discuss how you should manage your money in your 20s. Because there is never a better time in life to set a very good financial foundation. Everybody talks about making money, and I do too. But today, let’s look at how can manage the money that you have.

The choices you make in your 20s, especially in the area of your finances will affect your life for many years. That’s why it’s important to work on building healthy financial habits now so that you will benefit later. Developing good spending and saving habits, learning how to budget wisely, and investing in your 20s will definitely help you prevent unnecessary debt, put away money for the things that are important to you, and build transgenerational wealth.

When you’re in your twenties, you may not think too much about building the right structure for your finances. This kind of goal may feel like the kind of thing you need to worry about when you finally ‘make it’, ‘settle down’, or start your “real life.” After all, what are you managing when you don’t have so much money?

Everybody is different, so naturally, we are going to have different financial goals. But if you’re feeling confused and overwhelmed about money, it might be helpful to see suggestions for milestones to hit at certain points in your life. You can then take those broad suggestions and customize them so they fit your life. With that in mind, here are some solid tips on how to manage your money in your twenties:

How to Manage your Money in Your 20s

Learn how to manage your money in your 20s

1. Have a Side Hustle

Except you have a very privileged background, relying on a single source of income in this day and age is very very risky, especially when you are still in your twenties. In your 20s, you’re likely to have fewer responsibilities and, therefore, more time on your hands to pick up a side hustle or two!

9 to 5 is amazing but in most cases, not enough to help you shoulder the responsibilities that are shouting for your attention. In your 20s, you would want to be more responsible about yourself and cannot be running to your parents all the time to ask for basic stuff.

A very good illustration of why you need a side hustle is the situation of the Nigerian economy, coupled with the fact that Federal universities have academic strikes every now and then due to the irresponsibility of the government towards lecturers. If you are a student affected by the strike, you cannot eat your grades. You need to have a way of making money, asides from scholarships that you receive.

There are many risks that come with relying solely on your 9 to 5. What happens if you are sacked?

Now, when I talk about a side hustle, you don’t have to even leave your current job to work. There are some legit ways to make money online that will help you work for people and get paid without being physically present.

Your side hustle could be something that helps you make some quick cash or perhaps something you really have passion for that you could grow into something bigger and maybe start your own business. Whatever it is, you would want to use your 20s to build multiple income streams of income that will help you to gain much more financial stability and the money you earn can be put towards good use such as contributing to your retirement plan, or investments.

2. Save for the Rainy Days – Have an Emergency Fund

Sh*t happens! Instead of taking on more debt to pay for your phone’s screen that suddenly got damaged after you dropped it, you can use the cash in your emergency fund.

What is an emergency fund? An emergency fund is a money that you set aside to help you handle unexpected expenses.

There are many ways to build an emergency fund. You can dedicate five to ten percent of your income per month to this fund. Gradually, as you get more money, you can start putting a higher cut into this ‘special account’.

According to the American Psychological Association, money is a significant cause of stress in adults. It is a significant cause of stress for more than 70 percent of people between 18 and 35 years of age.

You do not need to always be in debt, it can be avoided. Only if you save your money.

Now, you have to save wisely. Think of saving your money in stable currencies, like the American Dollar. Apps like Piggyvest and Barter by Flutterwave allow you to save your money in dollars, making sure that your money will not lose its value as the Nigerian naira depreciates.

3. Have Self-Control and Discipline

If you’re lucky, your parents taught you self-control when you were much younger. Learning how to delay gratification is an important skill everyone must-have. Have you wondered why many people remain poor? It is because although they are poor, they love to act rich.

Even if you have the money to buy something, think of how your purse will be after the purchase. Or do you want to be soaking garri for two weeks, because you bought an expensive iPhone? It does not make sense on any planet.

So, a general rule that I abide by (except when I changed my phone recently lol) is that if I cannot pay for something five times, and it is not an essential material, I should not buy it. That has helped me maintain my sanity and to keep me in check.

That does not mean you should not buy things you want. Another good habit is to wait at least 24 hours before making a major purchase.

Many people want to live fake lives in their twenties. It is not worth it. You may get all the likes that you crave on Instagram, but you will know within yourself that the lifestyle is not worth it!

You have to come to a point where you control how much you spend on things that don’t have such a huge impact on your life. Most times, we don’t realize how much money we actually spend on irrelevant things.

4. Read Good Books on Money

If you don’t learn how to manage your money, other people will find ways to help you to mismanage it.

One of the strangest things about this generation is that we all know that money plays a huge role in our lives, but most of us didn’t have the chance to get any formal personal finance classes in school. Our parents often don’t talk about money management either, asides from the usual ‘Work hard’, “Don’t collect sweets from strangers’, ‘Don’t steal’ etc. This is sad because knowledge truly is power.

It’s never too late to start educating yourself about personal finance, and it’s so easy to get started because there are so many free books on that. In fact, I have read some books and I keep reading books that teach me how to manage my money and make more money. Here’s a short video of how I keep up with most of the books.

money books

You can start by reading these books:

  1. The Richest Man in Babylon by George S. Clason.
  2. Rich Dad Poor Dad by Robert Kiyosaki.
  3. I Will Teach You to Be Rich by Ramit Sethi (don’t get fooled by the name, it’s a great book!).
  4. The Cashflow Quadrant by Robert Kiyosaki.
  5. The Road To Financial Freedom by Bodo Schaefer.

If you prefer to read blog articles instead, here are some blogs that can teach you about your finances:


Knowing how to manage your money in your 20s has long-term benefits that can help you achieve future financial success. If you follow my advice, you will look back and smile in years to come.

It is important to find the right balance between working, saving, and enjoying your life. Take time to relax regularly, because you cannot ‘come and go and k!ll yourself’.

My name is Tomiwa and I'm very good at three things: WordPress, Marketing & Design.


    • Tomjoe Akanbi Reply

      You are welcome, and thanks for your comment. Glad that these tips were helpful, Stephanie

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