Biggest money mistakes made by Millennials

Millennials get a bad rap for being the me-focused generation who want everything now without having to wait.

But financial advisers say getting into debt and spending more than you earn in your 20s are some of the biggest money mistakes young people can make and it can set you up for a life-time of poor financial decisions.

Watch: Money Week - Do you worry about money - do you have a plan?

• Sharon Giblett, a Tauranga-based financial adviser who has a daughter in her 20s, says many young people make the mistake of focusing on today and forgetting about tomorrow.

"It's about the wants - they aren't thinking ahead to the consequences."

Giblett says an example of that is delaying signing up to KiwiSaver which could make it harder to buy a house in your 30s or have a comfortable retirement.

Giblett says for many young people saving is at the bottom of their priority list - they want to go to the pub or buy new clothes.

"And nobody has probably told them here are the dos and don't."

She also advocates avoiding a big student loan if possible.

While some people have successfully managed to use student loans to start a business or buy a house others fritter it on consumable items.

"If you just use it to fund pub spending then obviously that's not sensible."

She says students should try to start paying back their loan while still studying or better yet avoid getting one at all if possible by saving up ahead of time.

She says save first is the top tip she would give to all young people.

At any age if you can avoid paying for things via hire purchase or credit card do it.

Sharon Giblett

• Auckland-based financial adviser Simon Hassan believes the biggest mistake for those in their 20s is spending more than what they earn.

"Not only do they start what can become a lifelong addiction to debt, those who spend more than they earn miss out on the most valuable early savings years.

"Compound interest means that one dollar saved in your 20s adds as much to your retirement income as three or four dollars saved in your 60s."

His advice for young people is to sign up to KiwiSaver and start saving from your first job and invest in a growth fund.

"Even on the average wage this should see you build a nest egg worth $435,000 of today's dollars by age 65.

"That's enough to almost double your NZ Super through a 25 to 30-year retirement.

• Peter Lee, principle of financial advice firm C2C Partners, who also has two children in their 20s, says young people often act like they are bullet proof.

"That is part of being 20... they tend to think they are bullet-proof... which is a fantastic attitude to have."

But he says they also need to do some planning for the future.

Whether it is how they will get the most out of their career or save for a house.

His best tip: "Make the most of KiwiSaver. If you have got a chance to be in it, join it."

We will put it to financial adviser Hannah McQueen as part of our live chat online on Friday at 12noon.