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Many young people think it is too early to start thinking about saving for the future, or they don’t think about it at all. Then there are money mistakes a lot of people make in their 20’s/30’s that can have far reaching repercussions.

4 common mistakes people make with their money are:

Spending more than you make

This seems so obvious, yet so many people are victims to their own self-destruction. According to statistics, anywhere from 33% to 50% of Australians live payday to payday, meaning they do not save for the future or have emergency savings. I know people who are working on a casual/ contract basis and struggle to afford the expensive living cost in Sydney, but are often splurging on ‘retain therapy’ and Uber Eats – not forgetting also with the help of Afterpay. This is where you need to priority well and stick to your budget. There are many cash flow management tools which you can use to help you manage your finances better – give us a call and we can certainly direct you to the right channel. 

Credit cards and other high interest loans

Non-deductible debt is often another reason for bad cashflow management – when the desire to ‘keep up with the joneses’ kick in, chances are you will start accumulating more debt. Be it personal loan or credit cards, this is a slippery slope and the more you owe the more you pay each month in interest, which is simply lost money.

Not having a savings plan

Everyone should be putting a part of their salary towards saving. A popular figure used is 20%, this is how much of your salary should go towards savings. This is used to save for things like holidays or a house deposit or emergency cash, but everyone should be saving a little. Try an achievable target like saving up to at least 1 months’ salary, slowly save more till you have savings of at least 6 months’ salary. 


Insurance is crucial – many either do not have adequate amounts of cover, or they do not have it at all. Most people have some in their superannuation, but in terms of protection for anyone before they have significant others or families, or houses, the most important insurance is Income Protection. This insurance means you still receive a salary if you are suddenly unable to work due to unforeseen circumstances. Some may argue that if they are unable to work, they can fall back on their parents or family, but this is a way to avoid straining others’ financial resources. 

If any or all of the above apply to you, I strongly recommend you seek financial advice. It may feel like a lot of money, but make sure you are aware of the costs up front (anyone should be able to tell you costs up front with no obligation), and make sure the Adviser you see asks the right questions, i.e. ‘What is important to you?’, not ‘How much money do you have?’.

Karam Singh, Authorised Representative of Madison Financial Group Pty Ltd ABN 36 002 459 001 AFSL no. 246679.

He can be reached at or 1300 193 136.

This information is of a general nature only and neither represents nor is intended to be specific advice on any particular matter. We strongly suggest that you seek professional financial advice before action. The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc. as at the date of issue.